Last April, all but two of the largest and richest nations of the world agreed to contribute an additional $400bn to the IMF to enhance its ability to lend to nations facing financial crises. Other than some EU and Canadian officials, most politicians and policy makers have been fairly silent about the fact that Canada and the U.S. are the only holdouts among the industrialized countries that were asked by the IMF to raise their contributions to the firewall it is building to stem the likelihood of future financial crises.
“There was a not insignificant risk the whole summit would have been hijacked by a different outcome,” says James A. Haley, director of CIGI Global Economy research program, after the Greek election result indicated pro-bailout parties will likely form the next government. Haley was commenting from the Los Cabos G20 Summit, where he is representing CIGI.
"They are looking for an opportunity to better present their views by linking the issue of increased contributions to the IMF to the pre-condition of increasing the voices of the developing nations," says CIGI Senior Fellow Gregory Chin, commenting on the Chinese government's approach to increasing its contribution to the IMF's efforts to stabilize the euro zone.
"Failure to address the immediate risks to the global outlook, however, could result in an even more difficult challenge: preserving the system of international trade and payments that has been painstakingly constructed over the past 65 years and which has lifted millions out of poverty," says James A. Haley, Director of CIGI's Global Economy Research Program, speaking from the Los Cabos G20 Summit.
Although the short-term challenges facing G20 leaders have rarely been more daunting, failure to address the immediate risks to the global outlook could result in an even more difficult challenge – preserving the system of international trade and payments that has been constructed over the past 65 years and which has lifted millions out of poverty.
The word “cabos” means “end” in Spanish. But Los Cabos, the name for a white-beach corridor at the southern tip of Mexico’s Baja Peninsula, translates better as “the Capes.”
As for the word “summit,” it can mean at least three things, including: (1) “a conference of leaders,” (2) the “peak” of a mountain, or (3) the “height of achievement.”
The G20 Leaders Summit this coming week in Los Cabos will obviously be the first of those three, and definitely not the second, being at sea level. As for being the height of achievement, don’t hold your breath.
Against the backdrop of the ongoing sovereign debt crisis in Europe, CIGI convened a timely session at the annual conference of the Canadian Economics Association (CEA), on the challenges facing policy makers in the euro area and the rest of the European Union.
Looking for expert commentary ahead of and during next week’s G20 Summit in Los Cabos, Mexico? CIGI G20 experts will be available for media interviews, from LosCabos and offsite, from June 16-20.
Each year, CIGI hosts its premier event, gathering leading experts and policy makers from around the world to explore international governance issues and challenges. The CIGI ’11 conference, An Unfinished House: Filling the Gaps in International Governance, tackled questions regarding gaps in international governance, focusing on governance challenges under CIGI’s thematic areas of concentration. This conference report combines findings from the conference discussions with points from written responses and attempts to indicate the range, depth and flavour of the proceedings.
The situation in Europe continues to deteriorate. It may be far too pessimistic (or uncharitable) an assessment, but to channel Churchill (June 1940), it looks increasingly likely that: "the battle of Greece is over; the battle for Spain is about to begin." Historically minded readers will recall that between the fall of Poland and the invasion of France there was a "phony war" of relative inactivity that included half-baked and half-hearted (or disingenuous) attempts to find a peaceful solution to the European conflict.