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2 France BRICS up emerging
economies By M K Bhadrakumar
Former
United States secretary of state Henry Kissinger
once complained that Europe didn't have a single
telephone number. He didn't know who to turn to as
the authentic voice of Europe. The same can be
said today about BRICS, the grouping that has come
to personify the best and the brightest emerging
powers in the global order. BRICS comprises
Brazil, Russia, India, China and South Africa.
Dominique Strauss-Kahn's
summary exit from his job as the managing director
of the International Monetary Fund (IMF) over
allegations of sexual assault has badly exposed
the BRICS as an empty vessel that periodically
makes a lot of noise.
Hardly six weeks have passed
since China hosted the BRICS
summit in a trail of glory
led by nobody other than President Hu Jintao,
while, today, BRICS leaders would turn red in the
face with embarrassment if they recalled that the
People's Daily hailed their forum as the "anchor
of the global economy and politics".
Strauss-Kahn cannot become
the president of France, as he was reported to
have wanted. But, equally, his contribution to the
making of the world order will exceed present
President Nicolas Sarkozy's. Thanks to the manner
in which he quit his job at the IMF, a mad
scramble followed to grab his job, which, in turn,
has brought to the surface the fault lines in the
international system. But for Strauss-Kahn, the
birth pangs of the multipolar world wouldn't have
been so audible.
Despite the universal
homilies that the world order needs to be
democratized, when crunch time came, Western
countries rapidly closed ranks and staked their
claim in unseemly hurry to keep the IMF job as
their exclusive preserve.
Within a matter of 72 hours
or so, French Finance Minister Christine Lagarde
announced her candidacy for the IMF job, European
nations rallied behind her, the Group of Eight
(G-8) proclaimed its support and she kicked off on
a global tour. She posted a triumphant message on
her Twitter account on Sunday: "Flying to
Brasilia: tomorrow lunch with my colleague Guido
Mantega, meeting with governor of the Central Bank
Alexandre Tombini."
Acrobatic bear Yes, Lagarde had lunch in a
BRICS capital after securing support from another
BRICS country, Russia, which was present at the
G-8 summit dinner last Thursday in France.
The
irony is, Russia has been perhaps the most ardent
votary of the BRICS, but when it sat down at the
banquet table at the G-8 summit, it had an
identity crisis and it quickly decided it had
better be part of the Western world rather than
the moth-eaten developing world.
This
becomes all too apparent from the stance that
Russia took at the G-8 summit on Friday in
endorsing Lagarde's candidature. Russia was party
to the BRICS's statement on Wednesday that
questioned Lagarde's candidature and had sought a
"truly transparent, merit-based and competitive
process for the selection".
Russia also knew that a G-8
endorsement practically meant that Lagarde would
win the race since the G-8 nations account for 42%
of the voting electorate. But then, Russia didn't
have a candidate of its own qualified enough for
the IMF post. More important, the G-8 is one of a
handful of symbols that makes Russia feel
self-assured that it is still a big power with
global influence.
Underlying it all is
post-Soviet Russia's craving to be "accepted" as
an "equal" member of the Euro-Atlantic community.
Whether Russia entered into a Faustian deal over
some issue of vital interest to it remains
unclear, but it shouldn't come as a surprise,
either.
Anyway, the upshot is that
Russia almost overnight turned its back on BRICS,
whereas it has been swearing all this while from
the Kremlin ramparts that the grouping is the best
thing that ever happened in the post-Cold War
international system.
The
West and the rest The
US traditionally headed the World Bank and Europe
the IMF. The race over the IMF job underscores
that the West simply can't contemplate any other
way the world financial system can be run. The
Western attempt to hustle the nominations to the
IMF post by June 10 and to draw up the schedule of
election almost unilaterally in a weekend meeting
without even giving time for all executive
directors to assemble in Washington indeed
underscores that might is right. The IMF is
expected to announce the candidates for its top
post by June 17 and select its next managing
director by June 30.
All this is happening despite
the commitment made in 2007 at the time of the
selection of Strauss-Kahn by the Euro group that
"the next managing director will certainly not be
a European" and that "in the Euro group and among
EU [European Union] finance ministers, everyone is
aware that Strauss-Kahn will probably be the last
European to become director of the IMF in the
foreseeable future".
On the other hand, the
Europeans argue with a straight face that a fellow
national at the head of the IMF at the present
juncture is an imperative as the 17-nation
eurozone struggles to cope with financial problems
in Portugal, Greece, Spain and Ireland.
Within BRICS, all eyes are on
China and India. (Japan remains strangely
indifferent despite holding the second-largest
share.) Can China and India tango although they
have shared interests? That should have been the
big question. But it isn't. What is apparent is
that both China and India have taken an unusually
noisy stance but neither is doing anything by way
of concretely challenging Lagarde's candidacy.
Neither China nor India has
any credible candidate for the IMF post. So, both
have taken a "principled" position for purpose of
record. Beyond that, there appears to be no real
coordination between them, nor is either of them
inclined to work out a consensus candidate.
Interestingly, neither
Beijing nor Delhi has so far given a date for
Lagarde to drop by and formally push her
candidature. Beijing has also kept silent on
Lagarde's unilateral claim that she enjoys China's
support or her candidature. In reality, though, it
is clever tactic while both China and India seem
to be preparing themselves after riding the high
horse for a few days to endorse Lagarde's
candidature. For both, it will be a loss of face.
But then, both countries are hardened "realists".
Dragon slithers away ... All three major Chinese
newspapers carried editorials/commentaries. The
Xinhua commentary that was carried by People's
Daily and China Daily drew vicarious pleasure that
a joint statement by BRICS representatives at the
IMF last week is "a much-needed example of
coordination among these leading emerging
economies".
It exhorted the BRICS
countries to be "more confident in asserting their
common position, even if that may annoy others".
The commentary was in an obviously
self-congratulatory mood but it turned out to be
hyperbole.
The Global Times featured a
forceful editorial attacking the "backroom deal
between Europe and the US to respectively head the
IMF and the World Bank". It said: "Dominating the
global financial layout, the US and Europe are
grabbing colossal benefits in international labor
division." But then it went into an apologetic
mood, explaining that China lacked the clout to
put up a fight against Western dominance:
Besides, due to historical and
practical reasons, BRICS countries still have
misunderstandings and divergences among
themselves, which may be taken advantage of by
the US and Europe to disintegrate the group ...
It may take a few decades before the BRICS are
able to bring substantial changes to the
ingrained financial order ... It is still early
to stress the status of the BRICS members in the
IMF.
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