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US economic power is crumbling, but China is not yet ready to take over the reins. Martin Jacques reflects on the potential impact of the G20 ahead of world leaders arriving in London. Part of the NS’s unrivalled coverage of the global crisis
The G20 meeting on 2 April will deliver little but, like the first G20 meeting in Washington last November, its symbolism will be enormous. The very fact that it is taking place at all is an admission of the momentous shift in the global balance of economic power from the rich countries to the developing world.
If the western countries plus Japan could have sorted out this crisis through the G8, that would certainly have been their preferred route. The cosiness of eight nations (or preferably seven, excluding Russia) with rather similar interests would have made agreement rather easier and, more importantly, would not have implied that in future power would have to be shared with countries possessed of very different interests and histories.
We have come a long way in a very short space of time. In 2001, the United States was the world’s sole superpower, believing that it did not have to share power with even its historical allies, let alone the developing world. Just eight years later, the theme of the new president of the United States is rather more humble: that the US can exercise power only by co-operating with others. More striking still, there is the acceptance that it is no longer possible for the US to sort out the world’s problems in the time-honoured fashion – namely by means of a cabal with the other western countries plus Japan.
We are still struggling to understand the significance of the New Depression – its causes, its duration, its consequences and its possible solutions. Nonetheless, it is becoming steadily more evident that this crisis marks a fundamental shift in the balance of global power. Of course, this has been happening over a long period, certainly since China’s meteoric economic growth commenced three decades ago. The fact is that the rich countries now account for about only half of global GDP, a huge shift compared to 1970…
