The Evian summit
By Shahid Javed Burki
WATER from a spring in Evian, a small village located near Lake Geneva, on France’s border with Switzerland, is enjoyed the world over. The Evian brand name has become a symbol for good and clean living. It is also a good symbol of globalization — a process that continues to knit together a diverse world through commerce, financial flows and the movement of people across international borders.
But these are not the reasons why Jacques Chirac, France’s president, chose Evian as the site for the G-8 economic summit this year. The village is a good place to hold a summit since it can be protected from the damage that can be caused by rambunctious demonstrators who have serious misgivings about globalization.
French and Swiss security forces took extraordinary measures around this normally serene lakeside village and around nearby Geneva to prevent the kind of violent demonstrations that marred the G-8 meeting two years ago in the Italian port of Genoa. Given the extraordinary amount of expense and effort host countries have had to make in recent years to hold these meetings raises the question whether G-8 summits bring any value to international discourse. There is a growing feeling that this may be a good time to scrap these summits. However, there is also the desire to keep on giving the process of globalization a political push by summoning the leaders of the world’s large economies to meet formally every year.
The process of globalization which once held so much hope seemed to be going off-track as the summiteers gathered in Evian. American and European investors were selling foreign stocks and bringing their money home. Foreign direct investment in Brazil and Argentina and other emerging countries — the vanguard of globalization — hit its lowest level in a decade last year. Even China, the favourite of the investment community, was now under a cloud because of the spread of Sars. The boom in global mergers and acquisitions that, in the 1990s, had signalled the arrival of an international system of production, had burst. Ill-will among the world’s major trading partners, especially France and the US, had stalled progress on the Doha round of trade talks.
Were these developments mere hiccups encountered by the international political and economic system as it continued to digest the rich diet served by globalization? Or, was globalization on the retreat, having failed to deliver on its many promises? It is worth recalling that what we call globalization is not a new phenomenon and the difficulties it seems to be running into at this time have interfered before with its progress. Some 150 years ago, in the second half of the 19th century, several technological advances had begun to knit the world together. The invention of the steam engine, railroad and telegraph encouraged people, capital, goods and commodities to course around the globe at speeds not known before. All these factors of production were in search of economic opportunities wherever they could be found. This activity led to the birth of a modern, global economy.
As one account of that era puts it: “From 1870 to 1913, many technological breakthroughs lowered transportation costs by 45 per cent. Trade tariffs sank, and commodity prices converged, suggesting real integration was taking place. Capital flows from the United Kingdom, architect of the global age, reached nine per cent of its gross domestic product, a third greater than any country today.” All this was interrupted by two world wars and a severe economic depression. If globalization’s current problems were just a bump in the road, could a conclave of world’s richest countries help move it out of the way?
The idea of an annual meeting of the leaders of the world’s six largest economies - America, Britain, France, Germany, Italy and Japan — was first mooted by the French 28 years ago to ensure that the global economy remained on track. The first G-6 summit was hosted by France and was held in 1975 in Rambouillet, near Paris. The Rambouillet summit was really a dialogue between Europe - in fact, “old” Europe if we are to accept the way US Defence Secretary Donald Rumsfeld would like to divide the continent - and the United States. The Canadians were brought into the rich man’s club in 1976 and G-6 became G-7. Later still, the summiteers agreed to expand the membership in the club by adding the president of the European Commission. There was a logic in this move since the Commission’s voice was important in two areas - trade and aid to the developing world - that were often on the agenda of the meetings.
A couple of years ago, the G-7 expanded to G-8 by incorporating Russia as a member. Russia is a large country, but not a large economy. Its gross national income in 2000 was estimated at only $241 billion, less than that of Belgium’s $252 billion, one-fifth that of China’s $1,063 billion, slightly more than half of India’s $455 billion. But Russia was once a superpower. It still possesses a large nuclear arsenal and thousands of long-range missiles that can carry weapons of mass destruction to all corners of the world. By inviting Russia to join the group, the western powers (a term that should include Japan) were recognizing that size, history and economic potential could one day be translated into economic power.
At Evian, President Jacques Chirac took one more step to make the G-8 more representative. He persuaded his colleagues to invite a dozen leaders from the developing world to come as observers to the summit. The countries brought in represented several different developing countries’ interests. Brazil, China, India, Nigeria and South Africa were called in as continental economic powers from the three continents of the developing world — Africa, Asia and Latin America. Algeria, Indonesia and Mexico were invited as the representatives of the developing world’s oil-producing and exporting nations. Egypt came in as the country with the most important voice in the Middle East, in particular on the issue of the on-going struggle between Israel and Palestine. Malaysia and Morocco were brought in to represent the moderate point of view in the world of Islam.
President Chirac needed the comfort of a larger group around the table to counter America’s overbearing presence. He had irritated America by opposing its Iraq policy and by working hard to get Germany and Russia to its side. A few days before President George W. Bush left for Poland and Russia, en route to Evian, Condoleeza Rice, his National Security Adviser, said that American policy towards Europe would centre around forgiving Russia, isolating Germany and punishing France. At one point, several US Congressmen advised American consumers to boycott French wine, cheese and Evian water as one way of meting out punishment to a country that had dared to question their country’s Iraq policy.
If the American delegation went to Evian to signal to the French that they had not forgiven their president and foreign minister their strong opposition to the war in Iraq, Paris was not yet prepared to roll over and accept that the world had become unipolar with America now the sole and unchallenged hyper power. Paris sought to broaden the summit’s agenda. Having a dozen observer nations sitting at the table gave President Chirac the opportunity to focus the discussion on the world’s real problems. These, he said in his welcoming remarks, were the persistence of grim poverty in many parts of the world, diseases that took a heavy but avoidable human toll, a growing economic chasm between the world’s rich and poor nations and serious questioning by many of the benefits of globalization. But the Americans were not prepared to pay much attention to these concerns.
Patrick Sabatier, an editorialist for the French leftist daily Liberation, wrote in the days preceding the summit that President George W. Bush’s decision to limit his presence at Evian to one day “underscores that, viewed from Washington, problems of hard power — Iraq, the Middle East, terrorism — are more durable and far more important for the future of the planet than the concerns of soft power - development, the environment, social justice - that the G-8, the opponents of globalization and Chirac place at the top of the planetary agenda.”
From the beginning the Evian summit was heavily scripted to showcase President Chirac as the world’s best advocate for the concerns of poor developing countries. But in the end, it was America that prevailed. President Bush was able to hijack the French agenda. He deflected the summit’s attention from development in what was once called the Third World to the subjects that have been high on his list of priorities since 9/11 — terrorism and the spread of weapons of mass destruction.
The communique issued at the conclusion of the summit was in line with the axis of evil speech given by the American president in January 2002. It focused on the remaining problems in this axis - Iran and North Korea. “We will not ignore the proliferation of Iran’s advanced nuclear programme. We stress the importance of Iran’s full compliance with its obligation under the nonproliferation treaty,” said the G-8. For North Korea, the G-8 also had a stern warning. “We strongly urge North Korea to visibly, verifiably and irreversibly dismantle any nuclear weapons programmes, a fundamental step to facilitate a comprehensive and peaceful solution.”
What if the errant states did not fall in line with the wishes of G-8? “We have a range of tools available to tackle this threat: international treaty regimes, inspection mechanisms. . . [However] not all proliferation challenges require the same remedies. We need to deploy the tools which are most effective in each case...”
The meaning of all this was not lost on the world. The US had succeeded in arm-twisting other members of the G-8 club to focus most of their attention on matters that it considered of great priority. A not-so-veiled threat was given to Iran and North Korea that military action could be taken against them if all other avenues were closed.
At Evian, the G-8 moved a great distance from its original purpose — to save the process of globalization from running into serious problems. The Americans were too preoccupied with their immediate concerns to focus attention on the roadblocks globalization was encountering. There was a consensus among those who closely followed the summit’s proceedings that the Evian exercise produced little of value for the global economy. Perhaps it was a good time to take the globalization dialogue to other, more representative forums.


Making the OIC more relevant
By Ghayoor Ahmed
FOLLOWING the desecration of Al Aqsa Mosque, one of the holiest shrines of Islam, by an Israeli extremist on August 21, 1969, the leaders of the Islamic world met in Rabat and agreed on the need to institutionalize their efforts to strengthen and further fortify Islamic solidarity and to consolidate cooperation in political, economic, social, cultural and scientific fields.
To achieve these goals they decided to establish the Organization of the Islamic Conference, the OIC. In 1972 the charter of the OIC was adopted providing the necessary framework to pursue its stated objectives. It is admitted on all hands that the OIC has not been able to respond to the challenges faced by the Ummah which belied many of the hopes of the Islamic world.
A scrutiny of the performance of the OIC during the last 30 years indicates that the commitments of the member states to fulfil their obligations to the promotion of objectives, set out in the charter, remained merely a pious hope. The promotion of Islamic solidarity was the foremost objective of the OIC. However, most of its members remained content with the superficial unity among them which had a retarding effect on the overall performance of the organization.
Moreover, instead of harmonizing the collective interest of the Ummah, most of the member states often acted in self-interest which also adversely affected the functional capacity of the OIC and eroded its credibility as an institution that was established to promote and safeguard the common interests of the Muslim countries. It must be borne in mind that the OIC, as an international organization, is sustained and directed by its members. It cannot act independently to determine the course of action in response to the challenges faced by the Ummah.
The most pervasive challenge the Islamic world is currently facing is the sinister campaign that has been launched by some powerful anti-Islam lobbyists to denigrate Islam by equating it with intolerance and terrorism. Islam does not pose any threat to the western world or to the rest of the international community. The Muslims want to live in peace with all the nations of the world — without being dominated by them. In order to counter the sinister propaganda against Islam and to project its values, especially its humane message of tolerance, moderation and respect for human rights, the revival of the Islamic News Agency (INA) and setting up of the OIC’s own radio and television networks have assumed great urgency.
The OIC has already adopted a clear and unanimous stand on the issue of international terrorism. It has condemned terrorism in all its forms and manifestations. While stressing the need to evolve a universally agreed definition of terrorism, it has also underlined the importance of making a distinction between terrorism and legitimate struggle for freedom and the right of self-determination the denial of which can breed terrorism. No society which tolerates injustice or allows its continuation can hope to be free of violence. The OIC should, therefore, lay great emphasis on addressing the root causes of terrorism for achieving international peace, security and stability.
The two Muslim states, Afghanistan and Iraq, have already been targeted by the United States and its allies under the pretext of combating international terrorism. Regrettably, some of the member states of the OIC in the Gulf region sided with the aggressors and allowed their territories to be used by them for launching an attack on Iraq. Thus, they not only betrayed a brotherly Muslim neighbour but also shredded the Islamic unity into pieces. The OIC member states must emphatically reject the illegal occupation of Iraq and demand the restitution of its territories to its people and uphold their sovereign right to their own political, economic and social choices. Posterity will never forgive them if they failed to do so.
The fear is that the United States and its allies could also target other Muslim countries in the region from its bases in Iraq. The OIC must resolutely oppose any such illegal action against any of the Muslim countries under any pretext. It would be disastrous if the Islamic world remained complacent about such a sinister move against any other Muslim country. In the post- Iraq war scenario, the emergence of Israel as a dominant entity poses a serious security threat to the Middle East. The countries in the region should therefore immediately devise a strategy to face this ominous challenge with a view to protecting their geo-political interests.
Another equally important matter which requires a firm and unified position on the part of the OIC countries relates to the nuclear non-proliferation. Unfortunately, only the Muslim countries are the focus of concern in this regard which is clearly biased and discriminatory and must be strongly opposed. The OIC could, perhaps, co-operate with the international community in promoting a world free of weapons of mass destruction and seeking effective solutions to the common problems and contributing to ushering in an era of peace, security, stability and prosperity for all mankind.
It may be mentioned here that resolutions on various issues which are discussed at the Islamic conferences are invariably adopted unanimously. However, many member countries feel no qualms about adopting a diametrically opposite stance on those very issues in a bilateral context as well as at international forums, when it suits their purpose. As a result, the importance of the OIC’s resolutions is reduced. There is a general impression that the resolutions adopted by the OIC are only rhetorical in content and ritualistic in nature.
It goes without saying that unless there is a radical change in the attitude of the OIC member states, they cannot face the formidable challenges confronting them in the post-cold-war era. There is also an urgent need to revamp the OIC secretariat to make it more active and effective so that it may carry out its responsibilities with the seriousness and consistency needed.
The writer is a former ambassador.


President Bush, the enchanter
By Huck Gutman
THE novelist Ernest Hemingway once wrote, “All modern American literature comes from one book by Mark Twain called Huckleberry Finn.” The novel is one of the classics of the American literary tradition, in part because it reveals so much about American character and American values.
Early in Twain’s novel, the young boy Huck Finn and his friend Tom Sawyer decide they will try to become robbers. One day Tom readies an attack on a fabulously wealthy caravan. But when they charge, Huck recounts, “There warn’t no Spaniards and Arabs, and there warn’t no camels nor no elephants. It warn’t anything but a Sunday-school picnic.”
So Huck asks Tom what happened to the caravan, and Tom has a ready answer. “He said it was all done by enchantment. He said there was hundreds of soldiers there, and elephants and treasure, and so on, but we had enemies which he called magicians; and they had turned the whole thing into an infant Sunday school, just out of spite. I said, all right; then the thing for us to do was to go for the magicians. Tom Sawyer said I was a numskull.”
Twain’s narrative reveals much about the current administration in Washington. On March 20 the American nation went to war, supposedly to counter the threat posed by Iraq’s stockpile of weapons of mass destruction. But during the conflict and in the aftermath of victory, searches throughout Iraq failed to turn up a single instance of such weapons. Thinking back to Twain’s episode, it feels, as the American baseball player Yogi Berra once said in a maladroit statement that has become famous, “like deja vu all over again.” Though no one would posit a relation between the brutal Saddam Hussein and a peaceful Sunday school class, the parallel between President George W. Bush and Tom Sawyer is a bit close for comfort.
In Mark Twain’s novel Tom is an innocent, merely playing games, although later in the novel the cost of his games turns heavy for the enslaved Jim, since one of those games derails Jim’s flight to freedom and leaves him physically injured in the process.
President George Bush, on the other hand, is no innocent. In a carefully stage-managed event, the president ‘enchanted’ the nation on May 1 by landing on the aircraft carrier USS Abraham Lincoln, where the flight-suited president raised his arms aloft and declared victory in Iraq. Photographers snapped, the television cameras rolled, and the sun shone brightly on the successful chief executive.
Instead of that magician-ship, the president might have addressed something else: the catastrophe lurking in the rising American unemployment rate, which stood at 4.1 per cent when he took office and stands at six per cent today.
For that same May 1 marked something else besides a victory in Iraq. Almost totally unreported in America, the day set a low-water mark in the history of American manufacturing employment. When the president was inaugurated in January 2001 there were 18,291,000 manufacturing jobs in the United States. By May 1, when he landed on deck of that aircraft carrier, the Bureau of Labour Statistics reported that the number had dropped to 16,251,000. Even boyish Tom Sawyer could do the math. In the presidency of George Bush, over two million American manufacturing jobs were lost. Eleven per cent of American manufacturing jobs dissolved in just over half a presidential term.
Clearly, the president was not about to declare himself the magician who had made the jobs disappear. He preferred a different role, the enchanter transforming devastation at home into victory in Iraq. The president who had promised to build a stronger American economy now, aboard the USS Lincoln, promised “to rebuild Iraq” instead.
Manufacturing jobs are well-paying jobs. They have provided generations of Americans, especially those without a college education, a way into the middle class. In a recent study economist Lori Kletzer found two-thirds of the workers who lose such jobs earn less in their next job, with onefourth earning over 30 per cent less.
Increasingly, it looks like the United States will be a split-level nation: one tier of high paid workers like lawyers and accountants, another of low paid service workers, people earning the minimum wage for stocking the shelves at the discount store Wal-Mart or changing the linens in a local motel.
Surprisingly to many, the movement of jobs has not been the unalloyed good for the developing world, as was predicted. While per person income in Latin America rose by 75 per cent in the two decades from 1960 to 1980, in the era of free trade during two decades from 1980 to 2000, it rose by only seven per cent. In Africa, per person income has declined by 15 per cent in the last twenty years.
Although the situation is better in South Asia, the region is one of the two areas of the world (Latin America is the other) which have a current account deficit, meaning more money flows out of the region, and to the developed world than flows in. India’s current account deficit in 2000 was 2.9 billion dollars, or 0.6 per cent of its GDP; Pakistan’s was 2.2 billion dollars, or 3.6 per cent of its GDP.
The two-tiered economy is entrenched in much of the developing world, in imitation of the developed world — deja vu all over again. There are still 1.2 billion people who live in extreme poverty, on less than one dollar per day — a figure that has diminished by only 200 million in the past 20 years. Globally, inequality is increasing. In 1960 the richest 20 per cent of the world earned thirty times as much as the poorest twenty per cent; by 1994 that disparity had risen to 78 times as much. In 1980 median income in the richest 10 per cent of countries was 77 times greater than in the poorest 10 percent; by 1999 that gap had grown to 122 times. According to a recent study by economist Branko Milanovic, the wealthiest one per cent of the world’s citizens get as much income as the bottom 87 per cent — less than 50 million wealthy people getting as much as 2.7 billion poor people.
But back to the United States, where President Bush has neither acknowledged nor addressed the grievous loss of manufacturing jobs. His main economic initiative has been a tax reduction package, which according to recent figures gives 29 per cent of the tax benefits to the richest one per cent of Americans — more than the entire bottom 80 per cent will get. That works out to 74 million households getting a tax cut of $100 or less, while those families with one million dollar in investment and salary income will get a cut of $93,500. The rich getting richer, the poor getting nothing - this too is deja vu all over again.
Ever the enchanter, the American president responded to such figures by claiming they are merely partisan wordplay. “Oh, you’ll hear the talk about how this plan only helps the rich people. That’s just typical Washington, D.C., political rhetoric, is what that is. That’s just empty rhetoric.”
Huck Finn was not, as Tom Sawyer claimed, a “numskull.” He had it exactly right: when enchanted, the thing to do is “go for the magicians.” Americans need to see through the ‘magic’ of Mr. Bush, who tries to substitute war in Iraq in place of addressing problems at home. Citizens of the world need to see Mr. Bush as a ‘magician’ as well, one who substitutes manufactured crises in place of addressing the problems that beset the developing world.
The writer is a teacher in Canada and a leading columnist.

