2004 Sea Island Summit Analytical Studies
Sir Nicholas Bayne
Third draft, June 29, 2004
As at Evian a year ago, Iraq provided the essential context for the G8 summit of 2004. For many months, Iraq had produced only bad news for the U.S. and the other members of the coalition. But ten days before the summit, the tide turned. An interim government was formed in Iraq and began to gain acceptance. A United Nations Security Council Resolution was adopted unanimously, the day before the summit began, giving solid international backing for the transfer of power and the continued pressure of coalition troops. This provided a good foundation for G8 agreement on the broader Middle East initiative, the key innovation of this summit, and for other political decisions on nonproliferation, transport security and peace support in Africa. In contrast, the economic agenda took second place, though there were some advances in HIV/AIDS, transparency in government and engaging the private sector in development
The shape of the summit largely followed the model established at Kananaskis in 2002 and Evian in 2003:
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The Americans had originally intended to have no meetings with non-G8 countries. As the summit approached, however, they sought to involve regional leaders in the launch of their Middle East reform initiative. But many countries, such as Egypt and Saudi Arabia, hesitated to accept an invitation to the summit, so that a second meeting was laid on with African leaders. In the end, the G8 met with a mixed Middle Eastern group on the first day Afghanistan, Algeria, Bahrain, Jordan, Turkey, Yemen, plus the new Iraqi president and a strong African contingent on the second Algeria, Ghana, Nigeria, Senegal, South Africa, Uganda.
Meanwhile the idea of outreach to major non-G8 powers such as China, India and Brazil clearly remained alive. Jacques Chirac continued to advocate a regular meeting on the lines of the one he had held at Evian, while Paul Martin of Canada favoured a meeting at heads level of the countries in the G20 finance ministers, of which he was the first chair. Italys Silvio Berlusconi even envisaged enlarging the G8 to admit China and India. Britains Tony Blair, when asked, was cautious on enlargement but expected outreach to continue next year, when he would host the summit.
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From Evian to Sea Island
The Americans also resisted having many meetings of G8 specialist ministers in the run-up to Sea Island. Only G8 ministers of justice and home affairs met on terrorism issues, on 11 May. The G8 foreign ministers, who met in Washington on 14 May, had a brief session with President Bush, but issued no agreed statement. Their debates were dominated by Iraq and Israel/Palestine. France and Germany, though negotiating actively for a new UN Security Council resolution, made it clear that they would still not send troops to Iraq, so that the U.S. and UK had ceased to press for this by the Summit. The G7 finance ministers met in New York on 23 May and issued a statement giving an optimistic forecast for the world economy, in spite of worries about oil prices. Brief comments on remittance flows, entrepreneurship in development, and debt relief for poor countries foreshadowed decisions to be announced at the Sea Island Summit.
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Paul Martin of Canada was the only newcomer (apart from Bertie Ahern Ireland for the rotating EU presidency). Otherwise, the same group met around the G8 table as at Genoa 2001, Kananaskis 2002, and Evian 2003. But several heads were facing elections: Martin would go to the polls on 28 June (when Martin's Liberals lost their majority but remained the largest party in Parliament) and Bush was seeking re-election in November. Romano Prodis term as European Commission president would expire this year. Berlusconi and Blair were expected to hold elections in 2005, through Blair was confident he would still be there to chair the 2005 summit. Others, such as Chirac and Germanys Gerhard Schroeder, though secure electorally were meeting a loss of political support at home. These domestic political factors placed greater constraints on the heads, taken together, than they had faced in earlier years.
The leaders performance at the summit could only by judged on the basis of their press conferences. Bush himself came over as energetic and determined, with a visceral commitment to see things through in Iraq. He made his points by the force, not the subtlety, of his arguments. Chirac was individualistic as always, often, it seemed, going out of his way to distance himself from the U.S. He provided, as the Financial Times said, the grit in the G8 oyster. Schroeder, in contrast, was much more conciliatory to Bush, and was engaged on the Middle East and on debt relief. Blair was less visible than in previous years, perhaps holding his fire for Gleneagles in 2005. Junichiro Koizumi pressed the points of direct concern to Japan, especially on North Korea, while backing Bush on Iraq. Martin drew on his experience as the only former finance minister in the group. Berlusconi, Putin, Prodi and Ahern made no clear mark on the proceedings.
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All the G8 heads except Koizumi had met on 6 June at the 60th anniversary of the D-Day landings in Normandy. They were all welcomed by Bush at Sea Island during 8 June in time for a social dinner, with spouses and other guests, However, bilateral meetings already had begun that day, and the whole program provided ample time for these. The morning sessions on 9 June covered the world economy, international trade and entrepreneurship for development. After a working lunch with regional leaders, the G8 issued their Middle East reform plan and spent the afternoon on transport security and nonproliferation. The working dinner covered regional issues. On 10 June, the G8 turned to development issues, leading up to their working lunch with the Africans. Martin and Prodi left before the end, but some others met Bush again at Reagans state funeral in Washington on 11 June.
This analysis is mainly based on the summit documents and very thorough American briefings, leavened by comments from non-U.S. sources, especially from Chirac. It goes through the issues roughly in the order discussed.
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World Economy and Trade
The initial exchange on economic prospects for the world and for each G8 country reflected the buoyancy of growth almost everywhere. U.S. briefing singled out the eurozone as lagging behind both the rest of the G8 and major emerging markets. Chirac contested this and expressed concern at the size of the U.S. budget and external deficits, which could unsettle exchange rates and interest rates.
The G8 issued a statement on trade urging the resumption of negotiations in the WTOs Doha Development Agenda by the end of July. It stressed the gains that developing countries could make by removing their own trade barriers, but recognized that the pace of this would vary among countries. This reflected recent exchanges on the framework for negotiations, but contained no commitment on what would happen after July. It did not refer to the latest European Commission proposal to eliminate agricultural export subsidies, since this was resisted by France. Although trade was actively discussed by the G8 and was pressed again by the Africans on 10 June (see below), none of the briefings suggested the leaders themselves gave it a high priority. So this was only a low-power, short-term commitment.
Broader Middle East
The Americans had always intended the centrepiece of the Sea Island Summit to be the launch of a far-reaching initiative to encourage political and economic reform in the countries of the Middle East and North Africa, from Morocco to Afghanistan. (Pakistan was originally included, but was then dropped as belonging to South Asia, not the Middle East.) This idea was acceptable to the rest of the G8, as it closely matched the EUs Mediterranean program in force since 1995, called the Barcelona process. The Americans began soundings of regional countries, but a draft of their proposals leaked out in February 2004 and led to very adverse reactions. Egypt and Saudi Arabia in particular said they could not accept a process of reform that was dictated from outside.
Despite this reaction, knowledge of the U.S. initiative encouraged indigenous moves toward political and economic reform within countries of the region. This was driven by the private sector (business and civil society), but was also taken up by some governments and found rather hesitant expression at the Arab League Summit in May. Meanwhile, G8 summit preparations worked intensively on the U.S. ideas to convert them into a form that could be more acceptable in the region. In particular, the rest of the G8 saw no chance that the U.S. broader proposals could gain support unless they were linked to progress both in Iraq and in the Israel/Palestine dispute.
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The unanimous adoption of the UN Security Council resolution on Iraq thus created one essential foundation for agreement on the Broader Middle East Initiative and greatly lightened the atmosphere as the Summit opened. Blair also pressed Bush over breakfast on 9 June to revive the Israel/Palestine peace process, based on the "Road Map" and the work of the "Quartet" (U.S., EU, Russia and the UN). At the G8 lunch with Middle Eastern leaders, all the guests spoke and insisted, to insist that they were pressing home-grown reform plans out of conviction, because their peoples demanded it. Each country was distinct, but there was no "clash of civilizations" democracy was compatible with Islam. This was evident from Turkey, as the Turkish prime minister later pointed out to the press.
The G8 then issued two documents. The first was a political declaration establishing the "Partnership for Progress and a Common Future in the Region of the Broader Middle East and North Africa." This pledged G8 support for reform in the region, based on universal values freedom, democracy, the rule of law and specific principles: reform could not be imposed from outside; each country was unique; governments, business and civil society would be involved as full partners; and reform was a long-term effort, which required "a generational commitment."
The second document, the "G8 Plan of Support for Reform," embodied eight new initiatives, backed by an account of existing G8 activities in the region that contributed to reform. Two initiatives were political and institutional: the establishment of a "Forum for the Future" among G8 and regional countries, and a "Democracy Assistance Dialogue." The other six were economic and social, focused on micro-finance, education and literacy, training for employment, private sector development, financing and the investment climate. The Forum for the Future would involve not only governments (foreign and economic ministers) but also business and civil society.
Participation in these programs would be voluntary. But it was clear that the G8 hoped that all countries from Morocco to Afghanistan would be ready to take part, including those absent from the summit, such as Egypt and Saudi Arabia. The Americans were ready to admit Libya, Syria and Iran to everything if they renounced support for terrorism and possibly to some of the activities even without this.
The Partnership document embodied substantive commitments on Iraq and on Israel/Palestine. There was also a separate statement on the Gaza withdrawal and Middle East peace issued after the G8 had discussed this further over dinner on 9 June.
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The Iraq passage set out a strong G8 commitment to helping "the fully sovereign Iraqi interim government" to rebuild Iraq and make it peaceful, democratic and prosperous. While the principle of debt reduction for Iraq was accepted, U.S. ideas for near-complete debt forgiveness were resisted vocally by France and more quietly by Germany, Russia and Japan, on the grounds that this was far more than was on offer to very poor countries without oil resources. The matter was, in fact, not discussed by the heads, and it remitted to the Paris Club. The media made much of the way Chirac disagreed with Bush (and Blair) over whether NATO could be involved in Iraq. But this was later resolved at the NATO Summit on 28-29 June, after the new Iraqi government had made a formal request for technical assistance and training. Despite these differences, the documents reflect much closer G8 agreement on Iraq than before. France, Germany and Russia, while still critical of the U.S. invasion, have rallied behind the new Iraqi government and are satisfied by the safeguards in the UN resolution. This rapprochement was confirmed at the EU/U.S. Summit in June.
When Ariel Sharon visited Washington in April, Bush not only welcomed his plan for Israeli withdrawal from Gaza but also made suggestions about the shape of a final settlement that abandoned established principles deemed essential by the Palestinians. This was very badly received in the Arab world. The G8 summit essentially brought the process back on track again and sought to stimulate forward movement. The Partnership document invoked the basic UN resolutions and endorsed the objective of "two states living side by side in peace." It confirmed the central position of the Quartet in advancing the "Road Map." This language was intended to appeal to Arab countries and dispose them to work positively in the broader reform initiative. The separate statement on Gaza commended the Israeli withdrawal plan and called for immediate action by the Quartet to take forward the Road Map, while both sides should end all acts of violence.
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Terrorism and Nonproliferation
The afternoon discussions on 9 June resulted in the issue of a substantial "Action Plan on Nonproliferation," bringing together a range of issues mainly derived from U.S. initiatives. The key elements were as follows:
The G8 also returned to the issue of transport security, first raised at Kananaskis in 2002. It adopted the "Secure and Facilitated International Travel Initiative" (SAFTI), focused on improved practices to deter terrorist attacks on air transport, working with the International Civil Air Organization (ICAO).
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Over dinner on 9 June, the leaders returned to Israel/Palestine, as noted above. They also discussed Afghanistan (especially drugs) and Haiti, and also Sudan, on which they issued a short declaration.
The heads had a first discussion of the private sectors role in development on 9 June and issued an action plan on entrepreneurship and the eradication of poverty. They returned to development issues for the main morning session on 10 June. They issued six declarations and action plans: on health issues (HIV/AIDS and polio), on ending famine, on transparency and combating corruption, on debt relief, and on sicen and technology for sustainable development.
These documents clearly emerged from detailed preparatory work. Most of them were adopted on the nod, without debate by the G8 leaders. The heads did, however, have a serious exchange on finance for development. Chirac, who had been reticent on trade (especially agriculture), spoke out in favour of the British initiative for an International Finance Facility (IFF). This was resisted by the U.S., Germany and Japan, although Schroeder hinted at future flexibility on both the IFF and debt relief. But, in general, the G8 were hesitant over increased aid commitments, because of budgetary pressures in continental Europe and Japan and because of fears of Congressional resistance in the United States.
Entrepreneurship and Development
The G8 action plan on entrepreneurship and development drew on a report prepared for the UN by Martin and ex-Mexican president Ernesto Zedillo. Martin introduced the discussion among the heads and was pleased by the outcome. Earlier summits, such as Lyon 1996 and Denver 1997, had focused on foreign private investment as a force for development. But this was the first time the G8 sought to mobilize foreign remittances (estimated at $100 to 150 billion a year) or to assist private sector operations within developing countries, through improving the business climate, developing local finance for housing and water supplies, and encouraging microfinance. Most of the Action Plan encourages work already under way in bodies such as the United Nations Development Programme and the World Bank, but the G8s endorsement could give a worthwhile boost to this activity.
On health, the G8 agreed action to develop and disseminate a HIV vaccine. This built on a U.S. national program and aimed to develop international co-operation in creating, testing and manufacturing an HIV vaccine, with a report to the 2005 summit. The U.S. had earlier intended to seek increased contributions to the Global Fund to Fight AIDS, Tuberculosis and Malaria. But they decided not to press for this, when others argued for building up the operational capacity of the Global Fund before commiting more finance.
On polio, the G8 undertook to meet any funding gap in the World Health Organizations Polio Eradication Initiative, with the aim of ending polio in the six countries where it is still active India, Pakistan, Egypt, Afghanistan, Niger and Nigeria.
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The document on famine and food security built on the Evian Famine Action Plan. It sought to work with the agricultural development program launched by the African Union with help from the Food and Agriculture Organization, and focused specially on ending famine in Ethiopia.
Transparency and Fighting Corruption
The G8 document reported progress on commitments made at Evian under the heading of transparency and fighting corruption. A particular innovation was national "transparency compacts," where countries would get help in introducing in greater openness and efficiency into government operations. Georgia, Nicaragua, Nigeria and Peru were the first countries to enter into such compacts.
In a short statement on debt relief, the G8 undertook to extend the life of the HIPC program until the end of 2006 and to top up the financing if necessary. This was a small advance on what the G7 finance ministers had said and may lead to a commitment of up to $1 billion. However, there was no agreement on improving the terms of debt relief, where the UK was arguing for up to 100% relief on institutional as well as G8 bilateral debt, when this was needed to ensure "debt sustainability." The finance ministers were asked to report by the end of 2004.
Science and Technology for Sustainable Development
The G8 document on science and technology for sustainable development only issued four days after the Summit gave backing to the Japanese "Reduce, Reuse and Recycle" initiative. It also provided a review of actions taken since hte action plan on this topic issued at Evian. It was clear that some leaders, such as Chirac, would have liked a fuller discussion of the global environment.
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The G8 commitments on health and famine were directly relevant to Africa. In addition, the Sea Island Summit built on the commitment made in the 2002 G8 Africa Action Plan to make Africans capable of resolving violent conflicts among themselves by 2010. The new African Union was already committed to providing troops for peace support operations on the continent, but often these troops were poorly trained and equipped and could not be moved to where they were needed. The G8 therefore issued the Action Plan on Expanding Global Capability for Peace Support Operations, aimed at training 75,000 troops for peacekeeping operations by 2010, initially in Africa but also in other countries. There would also be measures to train "heavy police" (such as gendarmes and carabinieri). In addition, the G8 undertook to develop transport and logistics support arrangements by the time of the 2005 summit. The Americans are asking Congress for $660 million to finance their share of this program.
The summit ended with a working lunch attended by six African presidents. Four were regular participants at G8 summits Abdelaziz Bouteflika (Algeria), Olusegun Obasanjo (Nigeria), Thabo Mbeki (South Africa) and Abdoulaye Wade (Senegal). John Agyekum Kufuor (Ghana) and Yoweri Kaguta Museveni (Uganda) were newcomers, and Museveni made a long and impressive intervention about the importance of better trade access. Speaking at a press conference afterward, Obasanjo welcomed the continued involvement of the G8 with NEPAD. He expressed appreciation for the decisions on peace support, HIV/AIDS and famine, while stressing the contributions the Africans themselves were making to policy in these areas. But he noted that the G8 members were still debating internally about agricultural subsidies and more generous debt relief, implying that the G8 response was less than the Africans had hoped for. There was also a sense of some disappointment among the Africans that this years summit was not better integrated into the ongoing G8/NEPAD process. As Obasanjo said, they did not come all the way from Africa just to have lunch.
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The Middle East reform initiative is the outstanding innovation from this summit. It responds to the problems of a chronically troubled region. These problems include:
Only the G8 summit has the capacity to develop a response to such a wide range of problems, because of the leaders political authority and their ability to combine political and economic responsibilities. Such a combined response is necessary, as political unrest and economic under-performance feed on each other. The Broader Middle East Initiative is thus an example of the good use of the summit's potential, with intensive preparatory work being given high-level collective impetus by the heads.
The successful launch of the initiative must survive three immediate threats:
All the G8 members are braced for further bad news out of Iraq, while no regional power has publicly disowned the initiative. However, persistent controversy over U.S. actions in Iraq, or inflexibility by either side in Israel/Palestine could strain the fragile consensus reached at the Sea Island Summit and lead to recriminations among the G8.
There are also longer-term threats to the reform program. Unlike the G8s involvement in Africa, the initiative has not come from within the region. The regional powers are suspicious of U.S. intentions and resistant to any outside dictation. The G8 documents seek to dispel these fears, but the result may be that the desired reforms never achieve strong momentum, for two reasons:
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These dangers are well understood by the G8. This explains the stress on action over the long term, moving at a pace acceptable to regional countries and treating each one individually. Participation is bound to be incomplete at the outset, for example because of the strained U.S. relations with Syria and Iran, though the hope is that they could join in due course. There is no decision whether the initiative could embrace the Muslim countries from the former Soviet Union, nor is the Russian attitude toward this clear. But these countries too would benefit greatly from being involved.
In addition to the Middle East, the Sea Island Summit marked clear advances on other political issues, reflecting the attention given to them since the terrorist attacks of 11 September 2001. The measures on transport safety are politically motivated and extend work begun at Kananaskis in 2002, though they hardly deserve summit attention. The peace support action plan is intended to meet another Kananaskis commitment from the Africa Action Plan. Summit attention should help to mobilize the substantial funds involved. The nonproliferation action plan pulls together for the first time a number of distinct programs, which were all initiated by the Americans but have gained participation from the rest of the G8. This gives added authority to these programs, though the summit was not used to overcome remaining obstacles.
In contrast, the economic issues present a very mixed picture. Despite the usual lively discussion of the world economy, the heads could not go beyond what their finance ministers had said. The trade document has a very limited shelf life and lacks longer-term commitment, while there were no advances on the trade access issues of great concern to the African leaders present.
In the development issues covered, there are some innovative features, especially the mobilization of remittances for development and the measures to improve transparency of government operations. These are directed, more than before, to domestic aspects of development, rather than the external contribution of aid, trade or foreign investment. Though valuable, they are also intrusive and will need careful handling to ensure developing countries have "ownership" of the processes involved. Elsewhere, the economic documents either give G8 support to existing U.S. programs (as on HIV/AIDS) or report progress in implementing earlier commitments. The debt relief undertakings ensure that the HIPC program remains operational, but do not improve it. The science and sustainability document keeps alive the modest initiative begun at Evian in 2003.
The Americans left their distinctive mark on the organization of the summit and the conduct of both the preparations and the discussions among the heads. They changed their minds several times as the preparations advanced, for example, on involving non-G8 countries, but resisted proposals from their partners, for example on the environment. The documents to be issued by the summit were almost all worked out in advance in every detail, giving the heads little opportunity to make any personal impact on the outcome. American press briefings were full and highly informative, but said more about U.S. proposals than collective G8 positions. In short, the Americans took great pains that the U.S. version of events should prevail.
The consequence is that, six years from Birmingham 1998, the reforms to the summit format introduced there by Tony Blair are being seriously eroded. The practice of only heads coming to the summit, with small delegations, is now entrenched. But the aim of a short agenda with a limited set of specific items has been replaced by broad, all-embracing themes. Instead of a few concise documents, there is a confusing plethora of action plans and supporting documents. The summit has shifted from a focus on domestic issues such as jobs and crime, to a concentration on international problems, and from a largely economic agenda, with politics only on the side, to a growing emphasis on politics, or at least politics and economics combined. Some current trends are driven by events, especially the response to terrorism. Others are welcome advances, such as the launch of combined economic and political programs and the growing interest in outreach to non-G8 countries. But the G8 heads risk losing the capacity to strike deals and launch initiatives among themselves through personal interaction, which had been growing up to Kananaskis 2002. For next years Gleneagles summit, Tony Blair would be well advised to strive for a return to a more austere simplicity of format.