PARIS: When G8 leaders meet in Scotland this week, the star is arguably Chinese President Hu Jintao, an outsider whose booming Communist-run country is transforming the world economic order.

Whether the G8 club, which is 30 years old and comprises the United States, Japan, Germany, Italy, Britain, France, Canada and now Russia, can meet the challenges of the 21st century is no longer a purely academic debate, analysts say.

It is a burning question when China’s insatiable energy demands push oil prices sky-high, creating tension over fuel supplies that add to other disputes with Beijing, such as currency controls that make its cheap exports even cheaper.

Hu is invited to the annual G8 summit because others can no longer ignore a country of 1.3 billion people where one city alone churns out most of the world’s plastic pens and lighters and another city exports a big portion of the world’s computers.

John Kirton, a Toronto University professor, says the world’s old “economic establishment” is adapting by inviting leaders of large developing nations to its meetings, even if just as guests and not members.

Others see a change in membership as a possible solution.

“Hu’s presence may signal the increasing likelihood of expanding the G8 to include China,” Linda Yeuh of the London School of Economics says.

Alliance Trusts, an investment company, estimates that China will be the world’s second biggest economy in 2050, second to the United States, with India taking third place.

“The G8 countries account for 65 per cent of today’s world output,” it said in a report. “However, vibrant economic and population growth means that the balance of power is shifting.”

Just a few years ago, diplomats from G8 countries would laugh at the idea of making China a full, official member of their club.

But some developing nations played a big role last year in helping the global economy expand at its fastest rate in 30 years — 5.1 percent — despite slow growth in Europe and Japan.

The other big objection is that China is not considered a democracy in the sense that G8 membership entails.

But Russia was invited to join to anchor it in the world economic order after the Soviet Union collapsed and some have questioned its commitment to democracy. Russia presides over the G8 for the first time next year.

Leading industrialised nations first convened at a French chateau 30 years ago to address the big problems of the planet.

It began as the G5, but Canada joined in 1976 to flesh out a club that many came to regard as the closest thing there is to a global economic government.

Oil prices were a big worry then too because of supply cuts caused by the 1973 Arab-Israeli war.

Today high oil prices are blamed on roaring Chinese demand. But it is hard to tell a country it should not develop.

“Hu will say that there is no reason why the Chinese should stay on their bicycles so that Americans and Britons can drive larger SUVs (sport utility vehicles),” Andrew Oswald, economics professor at Warwick University in Britain, said.

Adding to the tension, Chinese state-controlled oil company CNOOC Ltd has just offered $18.5 billion to buy U.S. oil company Unocal Corp., sparking objections in the US Congress.

“I’m particularly interested in discussing energy with China,” US President George W. Bush said ahead of the G8 summit.

British Prime Minister Tony Blair has devoted his presidency of the G8 to seeking aid and debt relief for Africa and, despite stiff US resistance, a deal on combating global warming.

Britain also wants a pledge to complete the Doha round of trade liberalisation talks. That will be tough when Washington and Brussels are squabbling over farm export aid and aerospace subsidies, and both are unhappy with Chinese textile exports.

Joining the G8 leaders at the Gleneagles luxury golf resort are the heads of state of China, India, Mexico, Brazil and South Africa, all regarded as the bright young hopefuls of the world economy, though still fragile.

Kirton of Toronto University argues that, alongside the G8, more importance should be given to a forum called the G20, which was set up in 1999 but meets only at the level of finance ministers. It brings industrialised and developing nations together.


More From This Section

Watching Modi, the maestro, at work

SHAHJAHANPUR: The distance from New Delhi to Shahjahanpur is slightly less than 200 miles; a four-lane highway runs...

Why do so many people die in ferry accidents?

Ferries in developing countries are often old vessels, sometimes operating in waterways for which they weren’t designed.

Women edge into Gulf boardrooms as societies shift

DUBAI: Amina al-Rustamani, a member of a prominent UAE family, raised eyebrows among friends and relatives when she...

Gabriel Garcia Marquez: An influence ‘all over the planet’

Far beyond wider Hispanic world, Marquez’s influence is felt by and plays out in work of authors all over the planet.

Comments are closed.
Explore: Indian elections 2014
Explore: Indian elections 2014
How much do you know about Indian Elections?
How much do you know about Indian Elections?
Front Page