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The 2005 G8 Summit at Gleneagles: Repercussions on the African Continent

The 2005 G8 Summit at Gleneagles: Repercussions on the African Continent



Research Compiled by Intern Scholar Sonal Mittal



Brief History of the G8

The roots of the G8 lie in the oil crisis and economic recession of the 1970s. Confronted with fiscal challenges, the United States formed the Library Group, a contingent of financial officials from the U.S., Europe, and Japan, that gathered to discuss economic circumstances. In 1975, the Library Group became a more formal affair including the chiefs of government and the provision of annual summits; the Group was simultaneously renamed the G6 for the participating nations of France, Germany, Italy, the U.S., the U.K., and Japan. The appellation of G8 came with the entrances of Canada in 1976 and Russia in 1998.

Though the summits were originally designed to be a discussion place for matters regarding economic policy and trade, recent discussion has extended to areas of international political concern – the struggles of developing nations, Middle East volatility, and the reconstruction of Iraq have all become more outstanding on the G8 agenda.1 At the summits, leaders of the member countries have the ability to make agreements and set objectives that have repercussions on hundreds of millions of lives, both within and outside of their respective nations.



Africa’s Problematic Roots

The nations of Sub-Saharan Africa measure in the bottom tier of a worldwide life quality index published by the Economist Intelligence Unit.2 While other regions labeled a part of the “Third World” have progressed, Africa’s main achievement has been survival, not development. Brutal conflicts, food shortages, low life expectancy, high childhood mortality rates, and epidemics of HIV/AIDS and other diseases continue to plague the continent. Many of these ills have their roots in the corollaries of European colonization left from the late nineteenth century to the mid-twentieth century and the poor internal political direction provided after independence.3



• The nineteenth century was the age of industrialization; raw materials and new markets were therefore in great demand. Europeans saw Africa as a source of both of these things and so colonized region to ensure practices favorable to their own economic policies. At the same time, nationalism was on the rise and European competition manifested itself in colonial expansion in Africa. Racial perceptions of white western civilization as “enlightened” and superior to the people and cultures of Africa also furthered colonization by suggesting that it was Europe’s moral duty to civilize the world’s other populations. Western missionaries also supported colonization, believing that European control of Africa would provide a more facilitating atmosphere for the spread of Christianity.

• All colonial systems in Africa were undemocratic. Since colonial rule was imposed without the consent of the people, colonial governments often faced resistance or civil disobedience. Such challenges to regional authority necessitated the division of indigenous power networks and institutions, which was accomplished by capitalizing on group divisions and tensions and separating people of common language, religion, and ethnicity.

• Basic infrastructure was developed to exploit the resources of the region rather than to serve the people of the colony. Resources were exported, not used for local consumption. Furthermore, profits from these resources were sent to Europe – they did not stay within the colonies in Africa. Mineral mining and crop production also required large amounts of labor that led some colonial governments to create policies of forced labor. Other governments did not resort to forced labor but still maintained unfair working conditions with long hours and poor pay.

• Essentially, the lack of revenue within the colonies prevented public development and social change. Colonial political systems resulted in mass migrations of people from region to region, causing traditional practices to be challenged or overhauled. This led to a general cultural turmoil as families were split apart, causing the family’s composition and roles to change. There were also changes in religion and lifestyle as Christianity took root and cities emerged around the colonial governments.

• Between World War I and World War II, the people of Africa demanded equity and inclusion in government through peaceful protest and opposition. Following WWII, however, the example of India’s independence in 1947 as well as new ideals that outlined universal rights of self-government served to inspire mass political parties that demanded freedom and independence. The weakening world status of European nations helped actualize African independence; by 1966 forty-four colonies had been liberated.

• After independence, a number of corrupt dictators had taken charge of government. This was generally the result of a ruler’s inability to meet the social and economic demands of his people due to a severely weak nation-state with an underdeveloped economy. Colonial governments had ignored human rights and civil liberties, and rulers threatened by the dissatisfaction of the people who were denied their legitimate needs, found it easy to resort to the authoritarian measures used by the colonial governments. More strain was placed on the political systems when rulers played off ethnicity to keep themselves in power.

• African nation-states had strong connections to their former colonial powers; there were often economic, social, and political ties between them. These relationships had a significant impact on the nation-states’ policies and governance – Western powers secured agreements, supported civil wars, and upheld corrupt governments in a number of African nations. For instance, motivated by potential mineral wealth and anti-Soviet Cold War sentiment, the United States, in conjunction with Belgium and France, executed a CIA-led coup d’etat in 1965 to remove the nationalist prime minister of Zaire, Evariste Kimba, from power. Kimba was replaced by Joseph Mobutu who proved to establish a repressive, autocratic, regime riddled with corruption. Mobutu’s protection of cobalt, copper, diamond, gold, cadmium, and uranium reserves for Western companies earned Zaire U.S. defense in the face of any militant opposition.4 In effect, Cold War circumstances and Western support also furthered authoritarian political conditions within Africa.

• Globalization, like colonization, has had many detrimental effects on African economies; mono-economies, dependent upon a single export, have suffered with international trade in a global market. Due to competition from other parts of the world, the values of African exports, especially agrarian, have decreased, as the costs of industrial imports have increased. African nations must therefore continually export more goods for a static amount of imports. As a result, there is less revenue being generated for the country and in turn, less money is available for such things as education and health care. Nations are therefore forced to borrow money from the World Bank, foreign governments, or private transnational banks.5 As governments spent the borrowed money on human services rather than profitable enterprises, there was little remaining to invest in diversification and growth of economies, which left many African nations with the cyclic indebtedness, alarming poverty rates, and tensions we find today.



2005 Summit Resolutions

The 2005 G8 Summit focused largely on the promotion of progress, growth, and development on the African continent.6 This agenda was a general response to the cries of numerous nongovernmental organizations (NGOs) that called upon the G8 to meet aid pledges which would lead to the reduction of poverty levels, cancel unsustainable debt burden without conditions, and remove internationally harmful agricultural subsidies within their own nations. The member nations of the G8 did take a number of measures to sustain the targets of the Millennium Development Goals(MDGs)7 and to gain public support for their efforts.



• Before the actual summit meeting, U.K. officials and ministers were promoting their agreements on Africa through various public relations – supporting rallies, protests, and international Live 8 concerts, even going as far as to join such efforts.8 As a result, hundreds of thousands marched for the “Make Poverty History” campaign in Edinburgh with minimal police interference. Even more joined Live 8 - 1.5 million attended the concerts in ten cities, on four continents, in a display of solidarity against African want, and in support of the major pacts agreed to by the G8 nations.

• In terms of the G8 resolutions, the most outstanding feature was the cancellation of 100 per cent of the debts owed by the 18 poorest countries to the International Monetary Fund (IMF), International Development Association (IDA), and the African Development Fund. Russia additionally took specific measures to cancel $11.3 billion worth of private debts owed by African nations – $2.2 billion of which was owed by the poorest countries. Debt relief, holistically, was more widely considered; an advent that led to partial debt annulment for the nation of Nigeria.

• The E.U., Germany, Italy, France, and the U.K. have announced timetables to realize Official Development Assistances (ODAs) equal to 0.7 per cent of their respective Gross National Incomes (GNIs), in accordance with the United Nations target, by 2015 or in some cases, sooner. The U.S. proposed to double aid to Sub-Saharan Africa from 2004 to 2010 – providing $5 billion per year and furthering HIV/malaria initiatives that amount to over $16 billion. Japan announced its intention to aggregate the ODA percentage of its GNI with a surplus $10 billion over the next five years and introduce another “Health and Development Initiative” of $5 billion. Canada also planned to double its international assistance from 2001 to 2010 with particular aid to humanitarian efforts. 9

• Along lines of trade reform, the European Union proposed to cut some of its farm subsidies while transferring others to farmers focusing on environmental preservation rather than maximized production. This was an attempt to improve Africa’s economic capacity to compete through means of fairer trade terms for African farmers. The G8 leaders also pledged to set a date for the end of farm subsidies in a motion to promote equitable commerce between Africa and other nations.10

• The focal points of the summit, in terms of the G8 concern for Africa, were centered on debt, aid, and trade. However, the Gleneagles Communiqué, published by the G8 organization, also makes vague commitments to the promotion of better governance, stability, and peace in the region. The Africa division of the document makes numerous commitments of support to the African Union (AU), the New Partnership for Africa’s Development (NEPAD), and their various sustained undertakings. The document further states that efforts should be made to encourage United Nations activities such as the creation of a new Peace Building Commission, funding of relief during humanitarian emergencies, and a firmer implementation of sanctions. The roles of private multinational companies and relationships with pan-African organizations and other establishments such as the Organization for Economic Cooperation and Development (OECD) were additionally discussed in the communiqué.



2005 Summit Analysis

Sir Bob Geldof of the London Live 8 concert hailed the summit resolutions as epic, referring to the G8 convergence as “great” and favorably evaluating the outcomes: “on aid, ten out of ten; on debt, eight out of ten.”11 Artists addressed millions declaring victory in the fight for Africa. While many considered the 2005 summit a success, others were skeptical of the conclusions high in rhetoric, yet remarkably low in detail.12 With the sweeping promises that were made in the name of progression and relief, the agreements secured around African debt, aid, and trade should be considered more cautiously.


• The specified debt cancellation for the poorest 18 countries translates to a questionable victory for campaigners. Most NGOs agree that there are over 60 countries that require comprehensive debt relief, which leaves a sizable two-thirds unaccounted for. The 18 nations receiving debt cancellation – Benin, Bolivia, Burkina Faso, Ethiopia, Ghana, Guyana, Honduras, Madagascar, Mali, Mauritania, Mozambique, Nicaragua, Niger, Rwanda, Senegal, Tanzania, Uganda, and Zambia –were selected through an index of qualification established by the Heavily Indebted Poor Countries (HIPC) program created in 1996.13 The program requires nations to implement a number of economic reforms and adjustments prescribed by the IMF and World Bank14that essentially make their economies dependent upon the global market through international investment and rapid introduction of foreign capital.15 These conditions, which open domestic markets and eliminate tariffs via trade liberalization and privatization that a UN study has described as harmful, have had adverse effects on populations, increasing poverty and so undermining the aim of debt relief.16

• HIPC conditionality also prevents debt relief for nations with inequitable debt burdens.17Poor lending choices to corrupt regimes led to wasted money used by politicians for their own personal benefit or the finance of internal conflict. 18Today, citizens are forced to repay these debts though they did not benefit from the original loans. Further, conditions have allowed for the relief of only 10 per cent of the multilateral monetary indebtedness as they limit the number of countries that are eligible for relief.19

• After the summit, a World Bank document related to the G8 consensus on debt relief was leaked. It described the consideration of extending further loans to the 18 countries eligible for debt annulment; it additionally explained that nations receiving debt relief will likely need to continue borrowing money, suggesting they might also be particularly willing to do so without immediate debt concerns. In justification of the document, a spokesperson said the World Bank was unsure about the ability of poor nations to raise significant amounts of money due to their limited resources, noting that “they need as much assistance as possible to improve their economies, create their jobs, and make better lives for their people.” NGOs and activists, however, agree that new extensions to poor nations would keep them in recurring debt patterns and undermine the aim of any G8 debt relief.20

• In accordance with the Millennium Development Goals, the international community was hoping for ODAs equal to 0.7 per cent of the GNIs of the wealthy G8 member nations. While some countries took measures to reach that amount, others did not; the United States, which possesses the World’s largest economy, still spends only 0.16% of its national income on official aid. 21The general increases in aid will also fall short of the amounts required to realize the MDGs. The U.N. states achievement of the MDGs would require $50 billion annually – far more than the relatively modest allotted increases provide.22

• The U.S. has also been accused of announcing aid that was already pledged in the past. The Make Poverty History campaign calculates that only $20 billion of the entire $48 billion 23announcement was new money. 24In one instance, President George Bush announced his intention to contribute a surplus $4.5 billion to aid; of that amount, however, $3 billion had previously been promised under the Millennium Challenge Account established to demonstrate greater aid responsibility. 25Researchers also speculate that some of the money could have come from future aid budgets.

• Trade liberalization has been promoted by the G8 through direct exchanges for aid although the U.N. has demonstrated liberalization to be harmful. U.N. analysis has shown that national poverty rose in proportion to the extent of liberalization, regardless of the aid money received. The G8 additionally outlined their recognition of the importance of open markets in their trade statement, citing them as favorable to developing countries despite the U.K. government’s previous statements that such practices should not be imposed on economically fragile regions.

• Though the G8 nations have proposed to end agricultural subsidies, countries such as the U.S. and Japan continue to pay large subsidies to farmers with the backing of powerful lobbies. Elimination dates are set to be discussed at the 2005 Hong Kong Ministerial of the World Trade Organization (WTO) – a gathering that generally observes attempts by these nations to compel developing countries into policies of trade liberalization for the benefit of their subsidized farmers. A similar elimination of subsidies sans an actual date was also agreed to at the WTO meeting of July 2004, suggesting that the member countries of these organizations continue to repeat their known positions on trade, without any intent to actualize the positions into policy.


Conclusion

For all of the publicity and excitement surrounding the G8 agreements on Africa at the Gleneagles summit, only fractional amounts were truly accomplished. Actual debt relief and fresh aid, despite any previously attached conditionality, are praiseworthy, though holistically it appears that the resolutions reached at the summit were overstated in their bearings. While the leaders of wealthy, industrialized nations and artist figureheads were content to celebrate the agreements, internal groups within the African Civil Society issued a statement delineating how the G8 resolutions fell far short of their expectations for a comprehensive and radical strategy to make poverty history in Africa.26

If an African renaissance is to be achieved, the HIPC program needs to be eliminated as prerequisite to debt relief, if not removed altogether; agricultural subsidies must also be reconsidered and aid should flow with fewer restraints. However, as it appears that wealthy nations and international associations are more satisfied with largely insignificant symbolic concessions than they are with the actual realignment of power relations and redistribution of wealth in the region, the G8 has yet to accomplish much for the end of deprivation in Africa.










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2 “The Economist Intelligence Unit’s quality-of-life index.” Economist.com. 2005. 12 August 2005

3 Dowden, Richard. “Looking to leave the past behind.” BBC News Online. 9 March 2005. 22 July 2005

4Wright, George. “Mobutu was Chaos.” Z Magazine Online. June 1997. 13 August 2005


5“Studying Africa through the Social Sciences: African Economies.” Exploring Africa. 25 July 2005

6Knowlton, Brian. “Bush praises five leaders from Africa.” International Herald Tribune. 14 June 2005: 4.

7“UN Millennium Development Goals (MDG).” United Nations. 2000. 25 July 2005
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9United Kingdom of Great Britain and Northern Ireland. G8 Gleneagles 2005 Summit Documents. Signed

10Version of Gleneagles Communiqué on Africa, Climate Change, Energy and Sustainable Development. 8 July 2005. 26 July 2005 Associated Press. “Reaction polarized as G8 concludes.” CNN News Online. 9 July 2005. 22 July 2005

11 Shabi, Rachael. “Was Africa Shortchanged?” The Guardian Online. 13 July 2005. 25 July 2005


12Schechter, Danny. “The Limits of ‘Live 8’ and the G8 in Making Poverty History.” Common Dreams Progressive Newswire. 3 July 2005. 22 July 2005


13 “HIPC History.” The World Bank Group. 2 Aug. 2005


14 “HIPC initiative and enhanced HIPC initiative.” Paris Club Presentation. 2 Aug. 2005.


15 “G8 Debt Cancellation Deal: An Incomplete, Yet Positive Step Forward.” U.S. Network for Global Economic Justice. 21 June 2005. 23 July 2005


16 United Nations. United Nations Conference on Trade and Development. Trade and Poverty: A Developmental Perspective. 13-18 June 2004. 8 Sept. 2005.


17 “G-8 Debt Agreement a Step Forward, but Analysis Finds Deal Falls Short of What Is Needed to Address Global Crisis.” Common Dreams Progressive Newswire. 8 July 2005. 22 July 2005


18 Tripathi, Salil. “Writing off the debt.” The Guardian Online. 8 July 2005. 25 July 2005.


19 “First Step on a Long Journey: Putting the G8 Deal on Debt into Perspective.” Jubilee USA Network. June 2005. 1 August 2005


20 Mekay, Emad. “G8 Relief Could Lead to New Borrowing.” 2 Aug. 2005. 3 Aug 2005


21Watkins, Kevin. “3 million reasons to act for Africa.” International Herald Tribune. 8 June 2005: 7.


22“G8 condemn Africa to miss Millennium Development goals.” World Development Movement. 8 July 2005. 22 July 2005


23 Khor, Martin. “G8 moves a bit on aid and debt, but fails on trade and climate.” Third World Network. 15 July 2005. 22 July 2005.


24Knowlton, Brian. “Blair denies letdown over U.S. aid.” International Herald Tribune.


25 Suri, Sanjay. “G8 Summit: NGOs See Clouds Over Gleneagles.” Yahoo News. 5 July 2005. 24 July 2005


26 African Civil Society. “Joint Statement From African Civil Society Organisations At The Conclusion Of The 2005 Summit, Gleneagles, Scotland 6-8th July.” 8 July 2005. 22 July 2005