What is the G8?

8 June 2005 by Stuart Hodkinson


The G8 G8 Group composed of the most powerful countries of the planet: Canada, France, Germany, Italy, Japan, the UK and the USA, with Russia a full member since June 2002. Their heads of state meet annually, usually in June or July. is the annual summit of the ‘Group of Eight’ nations: Canada, France, Germany, Italy, Japan, Russia, UK and US. They are the world’s most powerful capitalist countries, sharing two-thirds of global wealth - and they want to keep it that way. So each year G8 leaders meet for face-to-face talks on their shared interests and then impose this agenda on the rest of us through global bodies like the IMF IMF
International Monetary Fund
Along with the World Bank, the IMF was founded on the day the Bretton Woods Agreements were signed. Its first mission was to support the new system of standard exchange rates.

When the Bretton Wood fixed rates system came to an end in 1971, the main function of the IMF became that of being both policeman and fireman for global capital: it acts as policeman when it enforces its Structural Adjustment Policies and as fireman when it steps in to help out governments in risk of defaulting on debt repayments.

As for the World Bank, a weighted voting system operates: depending on the amount paid as contribution by each member state. 85% of the votes is required to modify the IMF Charter (which means that the USA with 17,68% % of the votes has a de facto veto on any change).

The institution is dominated by five countries: the United States (16,74%), Japan (6,23%), Germany (5,81%), France (4,29%) and the UK (4,29%).
The other 183 member countries are divided into groups led by one country. The most important one (6,57% of the votes) is led by Belgium. The least important group of countries (1,55% of the votes) is led by Gabon and brings together African countries.

http://imf.org
and World Bank World Bank
WB
The World Bank was founded as part of the new international monetary system set up at Bretton Woods in 1944. Its capital is provided by member states’ contributions and loans on the international money markets. It financed public and private projects in Third World and East European countries.

It consists of several closely associated institutions, among which :

1. The International Bank for Reconstruction and Development (IBRD, 189 members in 2017), which provides loans in productive sectors such as farming or energy ;

2. The International Development Association (IDA, 159 members in 1997), which provides less advanced countries with long-term loans (35-40 years) at very low interest (1%) ;

3. The International Finance Corporation (IFC), which provides both loan and equity finance for business ventures in developing countries.

As Third World Debt gets worse, the World Bank (along with the IMF) tends to adopt a macro-economic perspective. For instance, it enforces adjustment policies that are intended to balance heavily indebted countries’ payments. The World Bank advises those countries that have to undergo the IMF’s therapy on such matters as how to reduce budget deficits, round up savings, enduce foreign investors to settle within their borders, or free prices and exchange rates.

, in which the G8 hold just under 50 per cent of voting rights. The other 176 member states have the rest. Although the summits get all the attention, the G8 is a secretive 365-day-a-year political process in which personal representatives of G8 leaders (known as ‘Sherpas’) work in the background to prepare the agenda and then oversee the imple-mentation of any decisions taken.

So, what the hell is the G7? Is it still going?

The G7 is the G8 minus Russia. Confused? Let me explain. In April 1973, worried by the state of the world economy and the prospect of losing control over it, the finance ministers of the US, West Germany, France and the UK met for crisis talks in the White House. By 1976, this had evolved into the ‘G7 summit’ with the inclusion of Japan, Italy and Canada. With the end of communism, the G7 began to court Russia in order to integrate former Soviet countries into the global capitalist system and ensure their nuclear weapons didn’t get into the ‘wrong’ hands. This arrangement was formalised as the G8 in 1998. But the G7 countries continue to exclude Russia from their most important meetings between finance ministers and central bank Central Bank The establishment which in a given State is in charge of issuing bank notes and controlling the volume of currency and credit. In France, it is the Banque de France which assumes this role under the auspices of the European Central Bank (see ECB) while in the UK it is the Bank of England.

ECB : http://www.bankofengland.co.uk/Pages/home.aspx
directors, saying Russia is not economically large enough to enjoy equal rights with G7 leaders. Get it?

Sort of. So what’s happening in Gleneagles between 6 and 8 July?

Every summer, the G8 meets in the country holding its rotating year-long presidency. This time it’s Britain and Blair is treating Bush and Co to a luxury break in the beautiful Perthshire golfing resort of Gleneagles - all on the British taxpayer. The three-day tartan shindig will cost some £150m to wine and dine 1,500 delegates, pay overtime to 10,000 police officers and help accommodate more than 3,000 members of the world’s media. The Treasury is providing £20m for security alone, citing the global terror threat of al-Qaeda and the prospect of tens of thousands of anti-capitalists protesters attempting to shut down the summit.

Tensions have been high between police and activists since the 2001 Genoa summit when Italian protester, Carlo Giuliani, was murdered in cold blood. A five-kilometre security fence will surround Gleneagles Hotel and eight-foot steel fences will guard the Scottish Parliament and the Queen’s Holyrood Palace. It’s not just good news for the Chinese steel industry though - the Scottish Executive says Scotland could gain a £1 billion-plus windfall from free advertising and resulting international tourism.

But it can’t be all bad, surely? What about all these promises to ‘Make Poverty History’ in Africa?

They’ve been making and breaking the same promises since 1976. So far, not a single country has kept its word to increase spending on international development to just 0.7 per cent of national income. Britain first promised this in 1970 and is still stuck at 0.35 per cent; Japan has actually cut its aid budget. The same is true on debt cancellation - the 1999 G8 Summit in Cologne promised $100 billion in relief for the poorest countries, yet most of it has failed to materialise.

G8 countries currently spend more on pet food than they do on international development. And while they condemn civil war and genocide in Africa, G8 countries are responsible for more than 90 per cent of arms transfers and sales to developing countries. It’s the same story on climate change. But it’s all academic because the impending oil crisis, countering nuclear proliferation in Iran and North Korea, the continuing ‘war on terror’ and Middle East peace are likely to dominate the real agenda.

Additional research by Alice Klein and Nick Dearden

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Craig Bloomfield




Source: Red Pepper (www.redpepper.org.uk/).

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