Thursday, 16 January 2014

Russia's G8 presidency provides a unique opportunity to build bridges between developed industrial countries and emerging economies

By Yuriy Zaytsev

At the beginning of 2014, Russia assumed the presidency of the G8. In fact, Russia is in the unique position of holding triple and consecutive presidency in the G20, G8 and BRICS between 2013 – 2015.

On the one hand it gives to Russia a splendid opportunity to link the priorities of these three institutions and balance the expectations of both developed industrial countries and emerging economies with respect to further developments in interconnected and international economic systems. On the other hand, it helps Russia to improve the efficiency of global governance by strengthening the cluster approach, as well as contributing to division of labour among the institutions.

In international practice, the cluster approach is associated with particular spheres, which constitute the framework for global governance. These include development assistance, international finance, macroeconomics, global security, environment protection, health, water and sanitation, etc. Responsibility for each sphere is divided amongst global governance institutions. Traditionally, the division of labor attributes an economic and financial agenda to the G20, while development assistance, environmental and security issues remain with the G8.

The set of presidencies started with the G20, which gave Russia a chance to consider the interests of both emerging economies and developed countries when discussing such topics such as effective governance, investments for economic growth and jobs creation, and transparency.

How do the BRICS fit into the global governance agenda?

“The BRICS” has evolved as a separate institution and serves as a forum for emerging economies to work on a development-related agenda in more thorough way outside of the G20. Its global governance agenda is still being formulated, partly because emerging economies are still wrestling with the challenges caused by the economic and financial crisis of 2008-2009, partly because they still have development-related issues of their own to resolve.

However, the BRICS agenda will broadly cover the issues most relevant to emerging economies such as population growth, food security, oil and natural gas, agriculture products’ price volatility, scarce water and land resources management, as well as urbanisation control.

Russia’s priorities for its G8 presidency correlate with a BRICS agenda

Russia’s priorities for its G8 presidency in 2014 include counter-drugs cooperation, the fight against terrorism, coping with conflicts, managing the risks associated with environment and man-made disasters, and global health security. These correlate with the BRICS global agenda with its focus on socioeconomic challenges and global security. What is more, these priorities can be also be applied to the Russian presidency in BRICS next year, and so providing a consistency to Russia’s presidencies in the global governance institutions and ensuring that its 2014 G8 Presidency won’t take Russia far away from the BRICS.

In this regard, Russia can mediate between the G8 and the BRICS, translating the perspectives of both institutions to each other. This could also contribute to furthering a BRICS global agenda, as well as ensuring the effective division of labour in global economic and political governance. The established global governance agenda of BRICS would strengthen also the G8 and the G20.

An added bonus to Russia’s triple presidency is the consistency of its internal arrangements around policy decision-making and a system for national-level management. The system supports the engagement of key stakeholders, such as the Ministry of Foreign Affairs, the Ministry of Finance, the Ministry of Economic Development and federal sectorial ministries, which are responsible for managing the activities in three global governance institutions. In fact, this note on Concept of Russia’s participation in BRICS underlines this unique role of the institution for both the G8 and the G20.

Dr Yuriy Zaitsev is a Research Fellow at the Institute of Applied Economic Studies, The Presidential Russian Academy of National Economy and Public Administration. He was also a Teaching and Learning Fellow for the IDS Rising Powers in International Development programme.