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    Middle East
     May 14, 2010
Cool G-15 heads take the heat
By Kaveh L Afrasiabi

TEHRAN - Cavalcades for eight presidents and more than a dozen foreign ministers may raise tensions among Tehran's drivers, yet their presence in the city for a Group of 15 summit throws cold water on the West's sizzling criticism of Iran.

The summit is both politically and globally timely as the United States and its Western allies do their best to isolate Iran at the nuclear Non-Proliferation Treaty (NPT) review conference in New York (May 3-28). They are counting on serious divisions within the 118-nation Non-Aligned Movement (NAM) as a prelude to applying more pressure at the meeting of the ''Iran Six'' nations next month over the nuclear standoff with Tehran, with a view to applying more sanctions on the country over its nuclear-enrichment program.

That India, Brazil, Argentina, Indonesia and Nigeria will be represented at the highest level at the May 15-17 conference will

 

likely boost Iran's bargaining position at the ongoing discussions in New York, where the NAM, led by Egypt, has already focused the spotlight on Israel's nuclear program. The Tehran meeting also provides a chance to gather momentum against a Western "sanctions strategy" that discourages foreign direct investment (FDI) in Iran, in light of initiatives aimed at bolstering "south-south" direct investment.

"This summit focuses on improving south-south cooperation, addressing global inequities and assessing the impact of global economic recovery on developing nations," says a professor of political science at Tehran University.

Brazilian President Luiz Inacio Lula da Silva's attendance may mean that Iran and Brazil are "getting closer on the nuclear fuel deal", according to the professor. Both countries have been talking about the possibility of Brazil assisting with the a Tehran nuclear reactor that provides radioisotopes for hundreds of Iranian hospitals.

Aside from the nuclear issue, the measure of a successful summit for Iran would be the extent to which it culminates in greater capital inflows from other G-15 countries, such as India, Brazil, Venezuela and Malaysia, many of whom act as both recipients as well as sources of FDI.

Iran's foreign economic policy under President Mahmud Ahmadinejad has already brought tangible dividends in terms of greater investment by G-15 countries. Investments by Indian companies OVL, Oil India and IOC in the development of the Farsi oil and gas blocks as well as the South Pars Gas field in Iran are cases in point.

Tata Steel has invested in steel plants, while Indian public-sector companies like Rites and Ircon helped develop the Chahbahar container terminal project in southwest Iran. Among other countries, Venezuela has also invested some $760 million in Iran's South Part oil fields and $700 million in a joint petrochemical project in Assaluyeh.

Still, despite tangible evidence of progress in Iran's "south-south" cooperation, Tehran's overall trade with partners in the G-15 bloc stands at about 6% of its global trade, with India its biggest trading partner. Last year, Iran's imports from the G-15 comprised about 11% of the nation's total imports. Tehran's relations with the governments of the G-15 nations vary, in light of its relatively small trade with Algeria, Jamaica, Nigeria and Senegal, compared with growing ties to Brazil, Malaysia and a few others.

The trans-regional G-15 [1] plays a pivotal role in offsetting Western cultural and economic hegemony and in many ways ensures the viability of non-aligned countries in the post-Cold War era - much like the smaller D-8 group. Five members of the largely Islamic D-8 (Iran, Indonesia, Egypt, Malaysia and Nigeria) are also in the G-15.

Having held the G-15 presidency since 2006, Iran passes on the mantle to Sri Lanka this week. This may present a unique opportunity for Sri Lanka, whose "globalized" economy depends heavily on exports to countries such as the US and the United Kingdom, to bolster its position through the expansion of south-south trade and investment.

Since 2008, the global financial crisis has led to drops in Sri Lanka's exports and inflows of remittances, FDI and foreign aid. The nation's export earnings declined 15% in 2009 compared with the previous year, while remittances were down 6%, according to a recent G-15 working paper. One of Sri Lanka's economic steps, fitting nicely with its G-15 agenda, has been its engagement in swap arrangements (rupees for other currencies) with friendly central banks; these and Sri Lanka's large expatriate labor force will benefit from its G-15 role, should this translate in greater economic ties with other member nations, including Iran.

The Tehran summit is likely to repeat previous calls for restructuring of international financial institutions and a more equitable representation of developing countries in those institutions.

Furthermore, in line with the G-15's initial agenda to serve as a "dialogue partner" with the Group of 20 nations, the Tehran summit is also likely to address the issue of food security and, perhaps, mobilize billions of dollars for a food bank to assist developing countries. Improving water resources has also been a priority and there is talk of a "water fund".

In discussing the G-15 summit, Tehran dailies are abuzz about addressing egregious inequities in world trade and the importance of easier access of the global market to the goods and services of the developing world.

The developed world may not necessarily like the message from the Tehran summit, yet for the majority of the world's population inhabiting the developing world bemoaning the Western world's domination of airwaves, news of this summit is music to their ears.

Note
1. The Group of 15 was established at the ninth Non-Aligned Movement summit meeting in Belgrade, Yugoslavia in September 1989. It was set up to foster cooperation and provide input for other international groups, such as the World Trade Organization and the Group of Eight rich industrialized nations. It is composed of countries from North America, South America, Africa and Asia with a common goal of enhanced growth and prosperity. The G-15 focuses on cooperation among developing countries in the areas of investment, trade and technology. The membership of the G-15 has expanded to 18 countries, but the name has remained unchanged. The members are Jamaica, Mexico, Argentina, Brazil, Chile, Peru, Venezuela, Algeria, Egypt, Kenya, Nigeria, Senegal, Zimbabwe, India, Indonesia, Iran, Malaysia, Sri Lanka. Iran accepted the presidency of the G-15 in 2006.

Kaveh L Afrasiabi, PhD, is the author of After Khomeini: New Directions in Iran's Foreign Policy (Westview Press) . For his Wikipedia entry, click here. His latest book, Reading In Iran Foreign Policy After September 11 (BookSurge Publishing , October 23, 2008) is now available.

(Copyright 2010 Asia Times Online (Holdings) Ltd. All rights reserved. Please contact us about sales, syndication and republishing.)


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