As the Eurozone crisis has continued, an interesting development has been the interest of the so-called emerging economic powers of what has hitherto been called the Third World in a positive outcome, and hints of a willingness to help achieve that, given appropriate conditions. This development follows, of course, a previous recognition by the major economic powers, the so-called G8, of the significance of these emerging powers, some of whom have been originally referred to as BRICS (Brazil, Russia, India, China, South Africa); and a consequent decision to expand the G8 to a G20 to encompass some of them as a kind of Board of Governors of the global economy.
But from that point of recognition of the need for incorporation of these new powers, the major powers, in particular the United States and the European Union grouping, have also recognized what we can call the political power implications of emerging economic power, and the significance of dealing with a now specific, longstanding demand from the BRICS and others. In particular, both Brazil and India have become insistent that they should now assume positions as permanent members of the United Nations Security Council, while it is being increasingly recognized that the African continent has no member on that institution. Yet both Brazil and India are major contributors to the peacekeeping activities of the UN, and in many respects they consider themselves more appropriate for permanent membership than, for example, Germany which, as a major funder of the UN, is also knocking at the door, and which considers that it has completed its penitence as one of the major instigators of the Second World War. Japan is in a not dissimilar position.
In the case of Germany in particular, Brazil and India would take the view that the European Union already has two members, France and Britain, on the Security Council, and that at least concurrent with any extension of the Security Council membership to their group, the case of leading BRICS cannot be overlooked. And in that regard indeed, France and Britain have expressed sympathy for an expansion that would include at least Brazil and India, with the United States already inclined to support Japan.
But this debate has taken on more salience as the international economic crisis has gripped the Western world since after the second half of the 2000 decade, and as the European Union has found itself in difficulty in autonomously finding a solution to the grave economic crises of some of its members. In this situation, the EU would appear to be desperately seeking to cope with the crisis without having to resort to major institutional change in the decision-making of the Eurozone. Its hesitations have given way to widespread concern that the EU’s economic union, which does not have the institutional elements of a fiscal union, and thus an appropriate system of economic governance including continuing practical oversight of member-states’ economic management, will now have to go beyond its own borders in search of a solution to the crisis.
It is in the context of a perception of this apparent shortcoming of the EU, in an arrangement which is now seen to be dominated by German conceptions of European economic integration, that the international institutions, in particular the IMF, have been looking for alternative ways of extending the reach of that institution to find resources that can provide it with more flexibility in the search for a solution to an European economic crisis which, it well feels, can extend itself to other parts of the global economic system. The IMF is well aware that the leading country in the institution, the United States, now seems to be overwhelmed by its own economic crisis, a situation that suggests a widening of that crisis to the developing countries who are major exporters to that country. From an international perspective, the prospect of a continuing paralysis of the federal system in arriving at a solution to the US’s own economic difficulties, makes the search for alternatives even more difficult
It is in that context too, that the IMF is concerned to find instruments, preferably supported by countries with substantial economic resources to spare so to speak, and not as crippled in policy-making as the giants of the United States and Europe seem to be at present. And that context would appear, also, to be the reason for the interventions of certain BRICS, suggesting that they are in a position to assist. So, the Chinese Premier, Wen Jia Bao, has felt able to suggest that in recognition of the sovereign debt problems facing some Eurozone countries (a reference no doubt to Greece and Italy), “we’ve expressed our willingness to give a helping hand many times.” This statement is not unlike certain Chinese references to the US debt problems. And in this case, the Chinese Premier has expressed a view, in respect of the Europeans which they would no doubt hold as relevant to the US, that “European countries must first put their own house in order“ – a pronouncement that developing countries, including our own, have heard countless times from the IMF itself, in pursuit of the policy of structural adjustment advocated by the United States and the European countries.
Prime Minister Wen, in a manner not unfamiliar to those at the receiving end of North Atlantic policy-making, has been linking economic help to geopolitical conformity. For in suggesting that China can be of help, he has also expressed the hope, in the case of Europe, that the Eurozone leaders “will muster the courage to appreciate the strategic importance of the Sino-European relationship such as recognizing China’s status as a fully fledged member economy” of the G8. The suggestion is clearly for a North Atlantic recognition of the new status achieved by China and no doubt others, and the necessity for giving this appropriate institutional recognition. This posture must, we suggest, be also seen in the context of an emerging struggle being undertaken by China, quietly but determinedly, to, in its view, rebalance relations among the countries of the so-called South China Sea arena in which, since the Second World War, the United States has had pre-eminence, given the postwar de-fanging of Japan.
Near home, we must note too, the recent kite flown by Brazil in the context of the current North Atlantic economic crisis. As is now well recognized, the dynamic expansion of the Chinese economy has provided a vent for expansion of investment from that country, and exports to that country from nations in Latin America like Brazil and Argentina, and in Africa like Nigeria and Angola. But the persistent sophistication of Brazilian economic policy, begun by President Fernando Henrique Cardoso, and subsequently pursued by the ‘populist‘ President Lula, has created a situation where that country was ready for the challenge of foreign (beyond the United States) demand, particularly in the sphere of agricultural products, and simultaneously, for the receipt of extensive investment not only from the traditional North Atlantic economies, but in particular from China. And in the current context then, the dramatic advance of the Brazilian economy has created a certain self-confidence and inclination of assertion of the possibility for a wider Brazilian contribution to global policy-making in the economic and geopolitical spheres.
It is then, from that perspective that the Brazilian Finance Minister, in the midst of the current crisis, has suggested that leading emerging economies should meet, in the context of the G20’s search for solutions to the current economic predicaments, to discuss “joint action to help the crisis-hit Eurozone.”
His appeal was made particularly to India, whose own economic growth over the last three decades, has surprised the North Atlantic powers itself. That growth has come as a result not of an external impulse, but the domestically driven policies of, most lately, Prime Minister Manmohan Singh, a respected economist previously well known in UNCTAD circles. The Indian response to the Brazilian initiative has been somewhat cautious, India probably preferring to play within the frame of the current IMF discussions, seen as being capable of influence in the weakened situation of the West. In terms of India’s perception of global geopolitics, the leaders of that country will probably take the view, too, that it is the persistent, quiet pursuit of country-to-country diplomacy that led to its recognition by President George Bush’s administration, of what is, in effect, its status as a nuclear power.
So the BRICS, and others, have become well aware of their power to open new spaces for global institutional change – new global rearrangements – for themselves not simply as emerging economies, but as emerging geopolitical actors. They recognize these rearrangements as occurring as economic constraints among the traditional powers, and persistent pushing continues, by powers like China in the spheres of geopolitics which, they now insist, concern themselves as much as they concern the North Atlantic powers. From that perspective, a widened diplomacy is the name of the game in the search of all major powers – old and new – for new global balances. And those traditionally accustomed to wielding the big stick now know that too.
