Zoellick Faults G-7, Calls for New Order

(Wall Street Journal)

World Bank President Robert Zoellick called Monday for expanding the Group of Seven industrialized nations to include major developing countries, saying the current world leadership structure is ill-equipped to deal with global crises.

“The G-7 is not working. We need a better group for a different time,” he said.
Laying out a broad vision for a “new multilateralism,” Mr. Zoellick pushed for greater cooperation in everything from financial and economic issues to energy and trade. “Just as the crisis has been international because of interconnectedness, the reforms will need to be multilateral,” he said.

The new approach “must build toward a sense of shared responsibility for the health of the global political economy,” he said in a speech here to the Peterson Institute for International Economics. “This means, chiefly and critically, that it must involve those with a major stake in that economy, those willing to share in the responsibilities along with the benefits of maintaining it.”

Speaking in the run-up to the G-7 summit and fall meetings of the World Bank and International Monetary Fund later in the week, Mr. Zoellick said the G-7 is unwieldy and has put a priority on “ceremony over policy.”

The G-7 should be doubled in size to include rising powers such as China, Russia, Saudi Arabia, Brazil, India, Mexico and South Africa, Mr. Zoellick said. Along with the G-7 countries of the U.S., U.K., France, Germany, Italy, Japan and Canada, the new group would account for over 70% of the world’s gross domestic product, 62% of its energy production, as well as the biggest greenhouse-gas emitters and development-aid donors.

Instead of becoming merely a G-14, the new “steering group” would have a more flexible makeup and coordinate more actively with public and private institutions, he said. Read more here.