End Times News Update
Sign: Ten Kings
Scripture: Rev 17:12-14
News Source: The Economic Times
Overshadowed by G20, G8 likely to preserve a role
23 Jun 2010, 1321 hrs IST,REUTERS

The Group of Eight is losing relevance as faster-growing rivals like
China and Brazil play a larger role managing the global economy, but
it will still endure as a key forum for traditional industrial powers.

Meeting in Huntsville, Canada on June 24-25, the G8 might look like a
warm-up act for the main event in Toronto, where the G20 gathers for
the weekend, but that’s not how the host sees it.

“As Prime Minister I go to a lot of summits. The G8 discussions are
probably some of the best, most useful, informative talks that I’m
involved in any single year,” Canadian leader Stephen Harper said in
an interview.

The G20 supplanted the G8 as the group that manages the world economy
during the global credit crisis, when the then US President George W
Bush summoned its leaders to Washington to forge a common response
that helped to calm financial markets.

But the G8 still provides a place where its members can, in theory at
least, thrash out their differences in advance and muster around a
common front at the G20.

“I think the G8 will continue to meet. I doubt they will have much
significance in the future but it will primarily be a caucus of the
rich countries en route to the G20,” said Fred Bergsten, director of
the Peterson Institute for International Economics, a Washington-based
think tank.

The rise of China to become the world’s third-biggest economy and the
fast growth of other developing heavyweights such as Brazil has meant
older powers can no longer sit on their own at the high table of
global policy-making.

Emerging economies served as a vital engine for the world economy
during the recession caused by the credit crisis and, in return,
earned them more clout at institutions such as the World Bank, as well
as the G20.

The G20 leaders summit was a necessary modernization. The G8 — which
groups the United States, Japan, Germany, France, Britain, Italy,
Canada and Russia — had no means to formally incorporate China,
India, Brazil and other successful emerging economies to discuss key
issues like currency misalignment.

Canada and other smaller economies in the G8 like Italy have most to
lose in the bigger group, as they are overshadowed by large emerging
economies in the G20.

Bush’s successor Barack Obama says he will continue to use the G20 as
the best place to tackle big economic challenges.

But that does not mean his administration has no use for either the G8
or the regular Group of Seven meetings of central bank chiefs and
finance ministers of all G8 countries except Russia.

Source: The Economic Times / Reuters