Every year, leaders of the world's most powerful countries gather informally for three days to discuss international economic trends and monetary issues. The meeting of these world leaders, most commonly called the Group of Eight (G-8), is known as the G-8 summit. Unlike governments or international organizations such as the United Nations, the G-8 does not have an existing support bureaucracy and the decisions made at G-8 summits are not binding on the participating countries or leaders. The G-8 members are Canada, France, Germany, Italy, Japan, Russia, the United Kingdom, and the United States. The presidency of the G-8 rotates annually and the country that holds the presidency is expected to host the annual summit.
G-8 summits were initiated to support the declining economies of the industrial nations. As early as 1973, the United States had organized meetings with the top government finance officials from West Germany, France, Japan, and the United Kingdom; and because these meetings were held in the White House library, the group became known as the Library Group. In 1975, with growing economic and political crises in the west, including the first oil crisis, a recession, growing trade deficits, unemployment, unstable national currencies, and growing threats of war and the proliferation of weapons of mass destruction, the president of France called for informal annual meetings with the leaders of the major industrial nations. The meetings were designed to help overcome bureaucratic conflict and economic nationalism.
The first meeting of world leaders took place in Rambouillet, France, in November 1975. The meeting included the heads of government of France, Italy, Japan, the United Kingdom, the United States, and West Germany. The group became known as the Group of Six (G-6). This first meeting focused on economic and monetary concerns related to the oil crisis of the 1970s. Canada joined the group at the 1976 summit. A representative from the European Union (EU) has attended summits since 1977 but the EU does not participate in political and security discussions. Because it does have its own currency (the euro) and central bank, however, the EU participates in financial and economic discussions. The Soviet Union began attending the summits as an observer in 1984 and Russia finally became a member in 1997. The first G-8 summit took place in 1998. Since then, the G-8 summit has evolved from a forum focusing on macroeconomic issues to an annual meeting that addresses a wide range of international economic, political, and social issues, and more recently security and microeconomic issues such as employment and the information highway; transnational issues such as the environment, crime, and drugs; and other issues ranging from human rights and regional security to arms control.
G-8 summits have proven valuable for policy coordination and face-to-face discussion on key issues, and these have encouraged agreement on some issues, although leaders disagree as often as they agree on economic and social policy. The summits are informal and operate with an understanding that agreements and decisions made there are guidelines for action and that there will be no penalties for failure to meet commitments made or adhere to policies arrived at during summits. However, these annual forums play a crucial role in the governance of the global economy. The G-8 members are industrial and market-orientated democracies and they are the world's most powerful economic and political countries. Although not representative of the world's population, these countries drive the policies and agendas found in formal international institutions. G-8 countries control nearly 50 percent of the vote in the World Bank and International Monetary Fund. They have enormous influence in the World Trade Organization and the United Nations Security Council. It is through these formal international institutions that many of the decisions made at the G-8 summits become reality. G-8 member countries often make deals and compromises with one another and then form power blocs to exert influence in world politics.
However, G-8 summits sometimes bring to the forefront the major points of disagreement between G-8 leaders. For example, at G-8 summits there has been little agreement between Europe and the United States, and therefore little coordinated action, on the issues of environmental pollution and global warming, military intervention, and debt relief for Africa and other Third World nations. In addition, other countries and groups of countries have power and a will to action in the world, and they sometimes vehemently disagree with G-8 policies and with actions agreed upon at G-8 summits. The G-8's critics argue that the ability of G-8 countries to dominate economic and military policies undermines the credibility of more representative institutions such as the United Nations, and that the world has enough resources to end poverty but that the market-orientated policies of the G-8 cannot solve the distribution problems that leave millions of people around the world living in poverty.
From a G-8 perspective, the macroeconomic policy coordination accomplished by G-8 summits has helped generate global growth and prevent a repetition of high rates of inflation and the worldwide recession of the 1970s. G-8 summits have helped deliver and manage a regime of flexible floating exchange rates that have enabled free-market practices to dominate the global economy. Since 1990 the G-8 has responded to numerous financial crises and attempted to reform the international financial system; the G-8 has protected the advanced industrial economies and encouraged the major multilateral institutions of global economic governance to respond more adequately to a rapidly globalizing world. In liberalizing trade, G-8 leaders have provided the critical political impetus to launch and successfully conclude every round of multilateral trade liberalization since 1975. In global development, the G-8 pioneered the process of debt relief for the world's poorest countries.
However, leaders of nations who are not invited to G-8 summits, along with civil society organizations and nongovernmental organizations, often claim that these same G-8 initiatives have failed abysmally or been misguided and that they have helped the G-8 nations but have failed the rest of the world. For example, the attempts to coordinate macroeconomic policies in the late 1970s and exchange rates in the 1980s failed to bring the development that was promised and actually devastated some economies. The critics agree that some initiatives have produced valuable changes, such as spurring multilateral trade negotiations, but only when more voices were allowed to participate and to affect decisions.
See alsoEuropean Union; United Nations and Europe.
Kirton, John J., Joseph P. Daniels, and Andreas Freytag, eds. Guiding Global Order: G-8 Governance in the Twenty-First Century. Burlington, Vt., 2001.
Kirton, John. "The Road from Rambouillet to the Sea Island Summit: Process, Accomplishments, and Challenges for the Corporate Community." Available at http://www.g7.utoronto.ca/scholar/kirton2004/kirton_atlanta_040507.pdf.
University of Toronto. "G8 Information Centre." Available at http://www.g8.utoronto.ca/.
Lorna Lueker Zukas