Annual Conference

History Of The G7 Summit:
The Importance Of American Leadership

Nicholas Bayne
British Invisibles

Keynote address delivered at a conference on “Explaining Summit Success: Prospects for the Denver Summit of the Eight,” sponsored by the University of Colorado at Denver and Metropolitan State College of Denver in co-operation with the University of Toronto G8 Research Group,”, Denver, Colorado, June 19, 1997.

The 1997 summit at Denver, Colorado is the fourth summit to be hosted by the United States. The first was held in San Juan, Puerto Rico in 1976, with President Gerald Ford as host; the second at Williamsburg in 1983, with Ronald Reagan in the chair; the third at Houston in 1990, with George Bush; and now Denver, with Bill Clinton. Each of these four can serve to illustrate the history and development of the summits and to show how the United States – and successive US presidents – have steered and influenced their growth.

PUERTO RICO 1976

The first summit of all, held in France in 1975, was a European idea, launched by President Giscard of France and Chancellor Schmidt of Germany. They saw the summits as occasional, free-standing events, very much the personal instrument of the leaders. But the Americans – Ford and Henry Kissinger his secretary of state – always saw the summit as an institution, for systematic cooperation on economic policy among the participating countries and for influencing the wider world. By calling the second summit in June 1976, Ford started the regular series of summits held each year in the summer – Denver being the 23rd. Puerto Rico was also Canada's first summit; and it thus became the summit of the seven – the G7 - which it remained until this year at Denver.

Ford left office very soon thereafter. But his successor, President Jimmy Carter, though he never chaired a summit, took a personal interest in shaping the summit as an institution. He had ambitious objectives for joint action at the summits: in economic policy coordination; in energy commitments after the second oil shock; and in international trade, helping to conclude the Tokyo Round of trade negotiations in the General Agreement on Tariffs and Trade (GATT).

WILLIAMSBURG 1983

President Ronald Reagan hosted the 1983 summit at Williamsburg, Virginia – the first attended by German Chancellor Kohl, who is thus by far the most senior of the leaders at Denver. As President, Reagan was less interested than Carter in using the summit for economic purposes. Some economic issues were regularly passed down to the G7 finance ministers, who emerged publicly at the 1986 Tokyo summit to replace the secretive G5. Even so, the summits of the Reagan era were concerned with checking protectionism, helping to launch a new round - the Uruguay Round - of GATT trade negotiations. They promoted schemes of debt relief for both low-income and middle-income developing countries.

Reagan's highest priority, however, was to use the summit for non-economic, foreign policy objectives; and especially to mobilise a common Western position in confronting the Soviet Union in the final stage of the Cold War. He did not always have everything his own way. But the summits reached some pioneering political agreements, stimulated by the US. Under Reagan's chairmanship, Williamsburg in 1983 clinched a vital deal on stationing US Cruise and Pershing missiles in Europe, to confront new Soviet missiles. Tokyo in 1986 reached a common approach on strong resistance to international terrorism.

HOUSTON 1990

When President George Bush came to host the 1990 summit in Houston, Texas, the demands on the leaders had changed in two ways.

First, in addition to the familiar economic and foreign policy topics, a set of 'global issues' were emerging. These were new subjects, which had come onto the international agenda because their treatment required the involvement of all countries. The summit countries felt responsible for leading the search for solutions. Some of these global issues were economic, like the international environment, which gained growing attention with the approach of the UN Conference on Environment and Development (UNCED), held in Rio in June 1992. Others were more political, especially a range of issues linked to international crime: money laundering; drug trafficking; the revival of terrorism; and more recently nuclear smuggling and corruption in business.

A second, more historic, trend for the summits was that, by the time of Houston, the Cold War was over and the Berlin wall was down. The summits of the Bush era led the Western effort to help the countries of the former Soviet empire to rebuild market economies and working democracies. For Central and Eastern Europe, opening trade access and mobilising financial and political support was fairly uncontroversial. But for the Soviet Union the process was much more difficult. This had had been, for over forty years, a hostile super-power; its economy was in a mess; there was no tradition of democracy; and the ties binding the Soviet Union together were coming apart.

DENVER 1997

The most fundamental change for the summits, which links directly to Denver, began not at Houston but a few weeks later at Aspen, Colorado – not that far from Denver itself. In early August 1990, as Iraq was invading Kuwait, Bush met Margaret Thatcher, the British prime minister, there. He heard her make a speech in which she proposed bringing the Soviet Union into association with the summit, so that the G7 could directly encourage the reform process President Gorbachev had started. Bush supported her idea, as did the others; and in consequence Gorbachev came to London in 1991, for the summit's first meeting with an outside leader.

But by then the Soviet Union was crumbling and Boris Yeltsin soon emerged as the leader of reform in Russia. He was invited to the next two summits (Munich 1992 and Tokyo 1993) to discuss with the G7 leaders how they could help Russia economically. Thus President Yeltsin has been coming to these summits for longer than any leader except Kohl, though he was not there at Lyon in 1996 because of the Russian presidential elections.

Russia needed the help the G7 could mobilise. But Yeltsin disliked having Russia come to the summit as a supplicant. President Bill Clinton sensed this from his first meeting with Yeltsin soon after taking office. From then on the summit looked for ways to involve Yeltsin with their work on equal terms. This was first done with foreign policy exchanges, at Naples in 1994; then with global issues at Halifax in 1995, where Yeltsin proposed a special nuclear summit. In 1997 the process is completed by making Denver the ‘summit of the eight', with Yeltsin present from the very beginning.

Clinton, with support from the rest of the G7, has encouraged this progression in recognition of Russia's responsible approach to international affairs; notably their assent to NATO enlargement, but also their role as permanent member of the UN Security Council. The Russians have most to contribute to the summit in foreign policy and global issues. But there is a strong desire in the G7 to see Russia more integrated into the world economy, as members of the Paris Club of major creditors, of the World Trade Organisation (WTO) and in due course the Organisation for Economic Cooperation and Development (OECD).

THE RESPONSE TO GLOBALISATION

This innovation of bringing Russia into the summits runs parallel with the other major trend in the summits since Clinton took office. This is the response to the globalisation of the world economy, which has gathered pace since the end of the Cold War. Here the Americans have usually taken the lead.

At recent summits the G7 countries have encouraged each other to take advantage of globalisation to achieve steady growth, low inflation and improved competitiveness – and the United States has been highly successful. But the leaders recognise that globalisation brings profound change and there can be losers as well as winners. In this, three broad issues have concerned the leaders.

First is the reform of international institutions. The final conclusion of the Uruguay Round – a tense subject for the summits over several years – created a new institution for trade, the WTO. But the older institutions, many founded after World War II, needed to adapt to the new demands of the post-Cold War world, with many more active participants. Following an American initiative at Naples in 1994, the Halifax summit of 1995 launched a review of these institutions, which is still in progress. Good results have already been achieved in the International Monetary Fund (IMF) and in many institutions of the United Nations family. The Denver summit will encourage further work at the IMF on better supervision of financial institutions and markets. Denver will also come back to the global environment, preparing for the UN meeting the following week, which marks five years from the Rio Conference.

Second is the impact of globalisation on developing countries. Many developing countries have profited greatly from globalisation, notably in East Asia. But others are falling behind and are unable to compete. The 1996 Lyon summit addressed development in general, focusing on better access to trade and private direct investment and on debt relief for highly indebted poor countries. Denver concentrates on sub-Saharan Africa, which is falling behind economically and is the scene of much human tragedy – though some countries have made great advances. This is the first time in 22 years that the summit has given special attention to Africa.

Third is globalisation and employment – the concern that globalisation means fewer jobs or at least less job security. In many continental European countries unemployment remains stubbornly high. Clinton was the first to focus on this issue, with the 1994 Detroit meeting of finance and labour ministers before Naples. French President Chirac picked up the theme in 1996, with the Lille meeting in preparation for the Lyon summit. Despite this attention, the problem remains intractable. So Clinton has supported the idea of Tony Blair, the new British prime minister, to have the 1998 summit, at Birmingham in the UK, address growth, employability and inclusion.

CONCLUSIONS

Some broad conclusions can be drawn from this survey:

• Summits only address hard issues – easy ones are solved at lower levels. So it is not surprising if summits do not always succeed. But they do not have the luxury of saying “this is too difficult for us”. They have to keep on trying, as with employment and completing the trade negotiations.
• The issues at the summits change over time, naturally. But the leaders are not just reacting to events; they try to shape them, according to their own ideas and convictions. The summit is an established institution. But it is still also the personal instrument of the leaders and they put their mark upon it.
• US leadership has been highly influential, as this brief history shows. Not all US ideas gain acceptance. Nor do all initiatives come from the US – the Europeans, for example, are in the lead on the global environment. But the Europeans, Japanese and Canadians all exert themselves to win American support, as they know it is essential. Now, when the US economy is so dynamic, the US can provide an example to its summit partners and to the world at large.