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Summit theme three - Emerging markets at the global governance table

It has long been recognised that the membership of multilateral organisations, such as the World Trade Organisation, the International Monetary Fund and the G8, fails to reflect the shape of the contemporary global economy. Large emerging markets, such as China and India, remain only minor actors in these organisations, while poorer countries in Africa and Asia may not have a role at all. Among the speakers at the Globalisation Redefined conference, there was strong support for extending the participation of emerging markets in multilateral organisations, and for ensuring that global governance is a more accurate reflection of the distribution of economic power.

There are tentative signs that global governance is catching up with economic reality. The fact that it is the G20, rather than the G8 meeting at Pittsburgh in late September, is a recognition of the greater say now enjoyed by the world’s larger emerging markets. As one political leader said: “The G8 will remain in one form, but it is no longer enough for the co-ordination of economic policy.” There are signs that the IMF could give greater voting rights to countries such as China. The Financial Stability Forum has also extended the participation of emerging markets. And it is hard to imagine the Copenhagen Summit on climate change, due to take place in December this year, without the engagement of China, India and Brazil.

These changes in the architecture of global governance reflect a shift towards a more multipolar world. Gradually, key emerging markets are being given a more prominent seat at the table. This is appropriate, given the vital role they now play in the global economy.

Outside the leading emerging markets, there is still a long way to go before lower-income countries gain a voice in global governance. But even here, there are some encouraging signs. At the April G20 summit in London, Gordon Brown invited leaders from Africa and ASEAN countries as observers. Although they could not participate directly, their status as observers is at least an improvement on previous summits when they would not be represented at all.

There are humanitarian grounds, as well as economic, for giving low-income countries a more prominent voice in multilateral organisations. One speaker suggested that leaders ought to consider a G30 rather than a G20 group of countries. “We don’t want to see an increasing split between the haves and have nots,” he said. “The world is too small for that.”

Greater involvement of emerging market governments in multilateral organisations is important to give those institutions credibility, said one speaker. “The United Nations Security Council has no representation from Africa or India,” he said. “So how can it be called democratic?”

The biggest challenges to globalisation that will emerge over the next few years – climate change, nuclear proliferation, resource and energy security, poverty and inequality – all require engagement by the full range of international stakeholders. If these challenges are to be addressed in the years ahead, there needs to be a move towards broadening and deepening the role played by emerging markets in the world’s multilateral institutions.