Group of Seven | A platform for the globalised elite
The 1960s were a period of restlessness. The anti-Vietnam war protests and civil rights agitation made the Lyndon Johnson administration uneasy. It was in this
The 1960s were a period of restlessness. The anti-Vietnam war protests and civil rights agitation made the Lyndon Johnson administration uneasy. It was in this backdrop that Johnson came to Michigan on May 22, 1964 to deliver his ‘Great Society’ speech. Johnson quoted Greek philosopher Aristotle to talk about how to create prosperity. “The Great Society” he said, “rests on abundance and liberty for all. It demands an end to poverty and racial injustice, to which we are totally committed in our time. But that is just the beginning.” The previous decade had seen the arrival of the Non-Aligned Movement (NAM) that mobilised the decolonised societies. With the upswing in domestic disturbances in the U.S. it was obvious that the U.S. that had provided loans and economic assistance after the Second World War would no longer be able to provide leadership to the global north on its own and that it would require support from the partner countries in the West. As the decolonisation gathered speed, there was a greater need for the Global North to team up. Thus was born the idea of reviving the Global Economic Governance in favour of the industrialised economies out of which would emerge the Group of Seven (G7) in the following decade. The Global Economic Governance (GEG) had been fashionable since the beginning of the Bretton Woods system but after nearly a decade of unrest in western societies, a definite push came in 1973 when the Yom Kippur war and hostilities between the Arabs and Israel triggered the first oil shock. The oil shock highlighted that the emerging order would challenge the domination of the western world. In this backdrop, the first World Economic Summit was organised by French President Giscard d’Estaing and West Germany’s Chancellor Helmut Schmidt in 1975 who invited the leaders of the U.K., Italy, Japan and the U.S. for a meeting at the Chateau de Rambouillet in France.
It began as the Group of Six and in 1976, Canada joined the grouping, making it the G7. The economic and financial crises of that time provided the G7 the agenda for the foreseeable future as it came to be known as a platform of industrialised countries for dealing with financial challenges. Beyond economy The 1970s were the decade of the New International Economic Order (NIEO) under which the Global south under the leadership of the Group of 77 and NAM demanded the establishment of a new economic order. Under this system, developing nations pushed for a transformation of global financial institutions such as the World Bank and the International Monetary Fund to deal with the requirements of the newly decolonised economies of Asia, Africa and Latin America. These demands, however, had to be adjusted against the overall power dynamics between the two superpowers, the U.S. and the Soviet Union. The G7 started playing a bigger role beyond pure economic issues during the 1980s when it provided a platform to industrialised countries to coordinate response to major conflicts that threatened to interrupt global supply chains. First was the Soviet invasion of Afghanistan, which was followed almost simultaneously by the hostilities between the U.K. and Argentina over the Falkland islands and the Iran-Iraq war. It also played an active role in dealing with various sides for the Lebanese civil war. In 1982 when Israel invaded Lebanon, the G7 expressed shock on Israel’s actions. On the Falklands dispute, however, it supported the U.K. and warned about controlling the conflicts in the West Asian region as they could spill into larger disruption of energy and navigation. Through coordination among the major economies, G7 for the first time in 1990 showed that it had acquired the ability to put economic pressure to a country that refused to abide by the norms of the international order.
The BriefWire