Did the G20 in Cabo San Lucas resolve the euro zone crisis? No. Doesn’t that just underscore what a waste of money these summits are? No. The world is far more complicated than that.
With today’s non-stop news cycles, it is almost inevitable that expectations for summits are so high that they can never be met. In fact, substantial progress is being made in the G20 in a number of areas, most of which never is reported.
The Europeans (specifically the 17 countries in the euro zone) are the only ones that can resolve their crisis. Canadian Prime Minister Stephen Harper minced no words when he stated this fact, and he has been criticized in Canada for having done so. It is not clear why, since US President Barack Obama and especially US Treasury Secretary Tim Geithner said essentially the same thing, as did British Prime Minister David Cameron (Britain is one of the 10 countries in the European Union that is not part of the euro zone).
The European Union will have its own summit at the end of next week. EU leaders seem to realize how dangerous the present situation is; markets see-saw up and down without obvious reason. The adoption, in a progressive manner, of elements of a fiscal union — in particular, measures that will ensure that the integrity of banks can be defended, is the desired outcome.
It stretches credulity to assert that Prime Minister Harper’s comments could seriously jeopardize the current trade negotiations with the European Union. These negotiations will proceed successfully when the European Union concludes that a free trade agreement with Canada is in its interests. Canada may well find the price, in terms of reducing or eliminating our agricultural protection, is too high. The Harper government, it is hoped, may have the courage to deal with this combustible issue.
If one takes the time to read the communiqué or watch Mexican President Calderon’s statement to the press, it is evident that progress is being made in a number of areas in the much-needed redesign of the global financial and economic system. Progress may seem slow, but it is happening.
While we are a long way from the G20 becoming a “global steering committee,” as a number of people (myself included) hoped, the agenda is expanding. The Koreans broadened it to include development issues and the Mexicans have now further increased the agenda to include environmental issues (all the more appropriate with the start of the Rio+20 summit this week). The references to meeting the challenges of climate change are welcome. Leaders have agreed that delaying action is a mistake and low-carbon development strategies are needed. One can only hope that action follows.
The G20 gives leaders the opportunity for bilateral discussions on the hot-button issues of the day. In Cabo, this included the Argentinian President Cristina Fernandez de Kirchner raising the Falklands/Malvinas issue with Prime Minister David Cameron. At least she can return to her electorate and report her démarche.
The discussion between President Obama and Russian President Putin on Syria, just might go somewhere. It seems that Obama accepts a Russian role in moving to the next stage in Syria, and Putin is saying he is not wedded to Assad staying. Time will tell if there is some sort of political deal brewing. Didn’t Russian ships carrying arms on their way to Syria turn around in the last day or two? It will not have escaped Putin’s attention that Obama also met with President Erdogan of Turkey about Syria.
We live in a world of increasing inter-connectedness, made up of 193 sovereign countries, but we lack adequate governance for this present degree of connection. The G20 is, slowly but surely, moving us in the right direction. Keeping the process of innovation in global governance moving forward is essential and, in this respect, Los Cabos has helped.