- The Washington Times - Thursday, October 23, 2008

The Bush administration responded Wednesday to calls from Europe by announcing a summit of world leaders in Washington to address the financial crisis, but the Nov. 15 meeting promises to be a clash of competing agendas.

The White House sees the postelection summit as an opportunity to agree on general principles that nations will implement, while Europeans want a detailed agreement on a new system of international financial regulation. The Bush administration also would like trade issues to be part of the agenda, something other participants are not likely to favor.

“I don’t believe that you’ll have any details coming out of this meeting in terms of things that everyone agrees to,” said White House press secretary Dana Perino. “Not every country is going to have the same solution. So there will be a lot of people coming forward with recommendations and ideas.”

But European leaders have made clear that they think the world regulatory system needs an overhaul.

“This first summit will be followed by several others, in order to refound the international financial system and, through better regulation and more efficient oversight, ensure the crisis is not repeated,” a spokesman for French President Nicolas Sarkozy said. Mr. Sarkozy was one of the first to call for a global summit on the financial crisis, last month at the United Nations General Assembly meeting in New York.



Mr. Bush and first lady Laura Bush will host the heads of state of the Group of 20 nations at a Nov. 14 dinner. The next day, the leaders will meet to discuss the global economy.

The U.S. president-elect — either Democrat Barack Obama or Republican John McCain — is considered likely to attend the summit because the victorious candidate will have to implement whatever agreements are reached and will have to conduct the negotiations on other matters. But neither the White House nor the candidates would speak definitively about such a scenario.

The Bush administration’s focus for this first summit, which is likely to be followed by further meetings with heads of state, is on fine-tuning an accurate diagnosis of the problem.

“The goal … is to identify the causes; note the progress to date that we’ve made working together in a coordinated fashion … identify principles for reform; and then task the working groups to put meat on those bones and figure out what the principles will look like,” Mrs. Perino said.

Showcasing the same approach it has taken to the climate-change issue, the White House said it wants to allow each country to operate independently and apply broad principles of an agreement however they see fit.

Speaking of transparency in financial markets, Mrs. Perino said “that might be something that everyone agrees on, that more transparency would be good, but not every country is going to have the same approach to transparency because they have different systems.”

The decision to include the G-20 nations, instead of just the Europe-heavy Group of Eight, is telling.

G-20 members are Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey, the United Kingdom, the United States and the European Union.

The G-20 includes China, India and Brazil — the world’s three most powerful emerging economies — that are increasingly important to solving any global crisis.

Those emerging nations also lie at the heart of an impasse over global trade talks, giving Mr. Bush an opening to speak against one of the great dangers he sees emanating from the global economic crisis: the rise of protectionism.

“In the area of trade, we are very, very concerned … not just here in the United States but in a number of countries around the world, about protectionist tendencies,” White House deputy press secretary Tony Fratto told foreign reporters Wednesday at a Washington briefing arranged by the State Department.

“When you experience this kind of shock, a frequent reaction is to turn inward and to think among some people that the best way to deal with a problem is to become protectionist,” Mr. Fratto said.

The summit will not be an occasion for any major pronouncements regarding the Doha round of trade talks, which collapsed in July.

Most heads of state likely will not even bring their trade ministers with them, and analysts say logjams will remain in place until spring, after elections in India, a key player at cross purposes with the U.S. and Europe.

But the occasion will give Mr. Bush an opportunity to make the case to key world leaders that free trade, and a successful Doha round, must be a part of any solution to fix the global economy.

“The financial matters should be the dominant focus, but trade can contribute, and positive action can send positive signals to the markets to supplement what is being done,” said Jeffrey J. Schott, a trade analyst at the Peterson Institute for International Economics.

Despite the unlikelihood of a breakthrough on Doha during Mr. Bush’s presidency, he promised Tuesday to make another attempt before he leaves office.

“The recent impasse in the Doha round of trade talks is disappointing, but that doesn’t have to be the final word. And so before I leave office, I’m going to press hard to make sure we have a successful Doha round,” Mr. Bush said in a speech.

At the every least, Mr. Schott said, Mr. Bush’s emphasis on trade will be important in combating a growing wave of protectionist sentiment.

“It is raising [trade] in the context of these extraordinary summit meetings as a means to both blunt protectionist pressures that inevitably arise when there is a recession, and also to try to get the major economies in the world together to use trade talks to help boost economic activity,” he said.

Sign up for Daily Newsletters

Manage Newsletters

Copyright © 2020 The Washington Times, LLC. Click here for reprint permission.

Please read our comment policy before commenting.

 

Click to Read More and View Comments

Click to Hide