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The G-7 and the Need for Reform

Cesare Merlini

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Reform and an Old Dilemma

The G-7 almost arose by accident. As pointed out in the article by de Guttry in this collection, it is not based on an international treaty and is not an international institution in the real sense of the term. What exactly is it then?

It is a meeting of heads of state or government, which grew out of the meetings of economic ministers, and which was rapidly consolidated into its current composition and annual frequency. In the course of its twenty-year history, other regular meetings (finance ministers) and ad hoc meetings (such as the recent one on labor) have been established under the G-7 umbrella, giving rise to a quasi institutional structure. The nature of this structure-semi-personal and at the same time semi-institutional-has always been the subject of political debate and analysis.(2) These competing characteristics pose a dilemma which has prompted the present hypotheses for reform-not only the proposals put forward by political scientists and economists, but also, and more importantly, those advanced by British Prime Minister John Major (3) and put forth in the final communiqué of the 1993 Tokyo Summit.

Why is reform needed, and why is it needed now, on the eve of the twentieth summit, after almost three complete seven-year cycles?

More informality

Some will say that the end of the Cold War has brought about major changes and that these changes cannot but affect the G-7. In fact, the G-7 arose from the desire to reconstruct economic solidarity after the collapse of the Bretton Woods system and to respond to the energy crises of the seventies; after 1980, it consolidated against -the. Soviet threat. John Major, however, does not refer to these changes. Looking at the evolution of the summits themselves, he claims that the summits have lost their original personal character, becoming institutional (or at least bureaucratic), and invokes a return to their origins. His proposal seems to have met with consensus from his colleagues, albeit with the varying perspectives that the country studies included in this collection bring to the fore(5).

More institutionality

The trend towards greater informality at the summits goes-at least apparently counter to another proposed by experts in the field such as the Group of Thirty and its 'spokesperson, former Canadian Sherpa Sylvia Ostry , (6) and American scholar John Ikenberry (7). Despite minor differences, they substantially agree on the need to strengthen the G-7's institutional structures and its mechanisms for economic coordination and political consultation. Consequently, they would also like to see some kind of formalization or structuring, including the Setting up of a permanent Secretariat and a Council of Ministers, along the lines followed over the years by what is now called the European Union.

The false dilemma

As Robert Putnam has maintained, the "return to origins" is a myth (8). Not even the first summit meeting at Rambouillet in 1975 was the kind of fireside chat that the autumn date would suggest and that popular -opinion would have us believe. Putnam's view is shared here, and the present work will argue that the personalization vs institutionalization of the G-7 is to some extent a false dilemma.

The G-7 is made up both of meetings of heads of state, the most visible part, and lower level consultation and concertation mechanisms. If the G-7 were reduced to the former, it would lose efficiency because it would count on the absolute power of the heads of state and government-something they do not possess. More than ten years ago Merlini pointed out that: "The complexity of the political and institutional structures of our advanced states injects into the summit process the multiple interactions of domestic politics and Western interdependence." (9).

In the past, the G-7 has played the intermediary in what Putnam has referred to as the "two- level game" of national and international politics and has been efficient to various degrees. At the same time, it has "internalized the positive externalities generated by coordination" (10). This role has been backed by both the momentum of the summit and the action of the mechanisms. But a problem now. arises: is the lower efficacy of the summits (which will be examined later, taking care not to idealize past successes) the result of the predominance of "mechanisms" over "momentum", or the predominance of national interests over collective ones and the change in the "quality" of leadership? The latter explanation is preferred here. Suffice it to recall how fashionable it is today to put the blame for the uncertainties, hesitations and egoism of the member states on the ineptitude of international institutions and semi-institutions (e.g. the case of Bosnia).

Returning to the reform of the G-7 and its motivations: Can the end of the Cold War and the epochal changes of recent years be ruled out as a cause of this desire for reform? Perhaps not. In a much more radical proposal than the one put forward by Major, former American diplomat W. R. Smyser starts out with the consideration that "given the changes in the world, all current institutions must be reexamined and reviewed", and concludes that "in this review, the G-7 mechanism cannot but be judged negatively" (11). While speaking at Davos, the new Secretary General of GATT, Peter Sutherland, launched the idea of replacing the G-7 with a broader institution (12). And a high-ranking official of the Clinton Administration interviewed by Putnam for this study says that a change in the composition of the G-7 (the entry of other great powers and, perhaps, the exit of smaller ones) and, therefore, in its objectives "is only a matter of time".

These statements reflect an attitude almost of indifference towards the G-7, which seems to be finding some acceptance in the United States today. This attitude could be transitory, specific to the current economic upswing in the US alone or the present stage of summits being held in "minor" capitals.

Judging from the national studies included in this collection, however, the G-7 is generally considered useful in all member countries-aside from the limits posed by the traditional duality of the French (always halfway between grandeur and integration) and the general skepticism of British foreign policy, particularly in recent times. In his article, Maull explains how the basic idea of the G-7 continues to serve the interests of the unified Germany. But the country most attached to this semi-institution could well be Japan, which does not seem as interested in trans-Pacific formulas such as APEC (Asia Pacific Economic C operation) as the US is. For Italy and Canada, participation in the summits is above all a status symbol, but it is also a recognition of their international role, all the more important in that the summits deal with both economic and political issues (something that does not apply to the UN Security Council); in addition, it provides a constraint for domestic political developments.

Certain American reservations on this or that point may conceal more radical criticism such as "the G-7 is no longer needed", "the G-7 stands for the old", "the G-7 is too Eurocentric", etc. Indeed, the old dilemma between personal and institutional roles is sometimes no more than a façade for the desire to question not only the G-7's functioning, but its raison d'être to date. Then let us look at this basic subject first.

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