Memo #115
(The first Memo from the Theme, Asia at the 2011 Cannes G20)
By Yves Tiberghien – yves.tiberghien [at] ubc.ca
In the midst of the great uncertainties of the Euro crisis and great volatility in global financial markets, the G20 Summit in Cannes, happening from November 3 to 4, 2011, is taking place at a critical time. Markets expect more coordination and more governance, although there are large gaps between US and EU interests. Strikingly, Asia owns five of the 20 seats in the G20 (China, India, Japan, Korea, and Indonesia) and is in a pivotal position. But will the five Asian powers coordinate their positions?
In the last five G20 summits, Asian powers have come together on two topics: development (elevated by Korea last year with strong Indian and Chinese support in particular) and the defense of an open world trading system (all five countries). Yet, we face an Asian paradox: acting together, the five Asian G20 members could play a huge role in agenda setting and as power brokers between the US and the EU. They share core features in their export-oriented state development models, and could push for a stronger balance between global markets and governance, fundamentally reforming the liberal norms of the Washington Consensus. Yet, not only do the Asian powers fail to coordinate, they have publicly faced off during past G20 summits.
This summit is unlikely to see an Asian breakthrough. The recent G20 finance minister meetings in Paris have seen conflicts between Japan and China over the Chinese currency exchange rate, IMF voting powers and resources, and rare earths. China is engaged in a delicate triangular global game with the US and the EU. Japan continues to downplay the importance of the G20 relative to the G7 and to APEC, choosing to place security interests ahead of global economic governance. Korea recently sided with Japan and the US on issues including current account imbalances, and with China on other issues, including the BRICS proposal on October 14, 2011 to boost IMF resources and invest in the Euro-zone. India and Indonesia have remained more aloof, focusing on the less contentious issues of trade and development.
The future of the G20 may well depend on the ability of Asian countries to find their voices, individually and collectively. This process may take many years and require new leadership.
About the Author:
Yves Tiberghien – Associate Professor, Department of Political Science, The University of British Columbia. Guest Editor for Theme: “Asia at the 2011 Cannes G20“.
Links:
- Post G20 Seoul Summit Meeting and East Asia: The Context of the Seoul G20 Summit and the Northeast Asian Paradox, EAI Issue Briefing No. MASI 2011-04, East Asia Institute, Seoul, Korea, August 2011. (By Yves Tiberghien).
- The Stiglitz Report: Reforming the International Monetary and FInancial Systems in the Wake of the Global Crisis. (Book by Joseph E. Stiglitz).
- G20 and the Global Development Agenda: Paradigm Shift or Paradigm Clash?, October 2011. (Paper by Yves Tiberghien presented at The School of Public Policy & Management, Tsinghua University, China).
Related Memos:
- Theme: Asia at the 2011 Cannes G20