The annual summit meeting of the Group of Eight leading industrialized nations is often dismissed as a photo opportunity for world leaders rather than a place where real policies are agreed upon. This year’s meeting, held earlier this week in St. Petersburg, Russia, was no exception. The summit declaration includes the usual list of concerns, and precious little that indicates the heads of state will do something about them. However, this year’s host, Russian President Vladimir Putin, has every reason to be happy with that. For him, the most important element of this year’s meeting is where it took place: The meeting validated Russia’s place among the leading nations.
Mr. Putin planned to focus the meeting on energy security. By doing so, he would highlight Russia’s role as one of the world’s leading producers of oil and natural gas. In addition, he sought to use the G8 commitment to “open, transparent, efficient and competitive” markets to pry open Europe’s own energy networks. Russia is eager to gain access to the downstream marketing of energy products, particularly in Europe, to diversify its interests and to earn a share of the profits from energy distribution, where the real money is made.
European governments have been reluctant to give Russian companies that access without reciprocity in the form of investment opportunities in Russia’s own energy reserves and infrastructure. They have demanded that Russia sign the EU Energy Charter Treaty, which calls for competition that would help crack Gazprom’s iron grip on the energy market in Russia. Mr. Putin says he supports the treaty in principle, but has refused to sign it. Moscow’s failure to permit foreign companies to make substantial investments in Russian energy infrastructure — or “national assets,” a designation that shields them from foreign ownership — has Europeans worried that Russia is not ready to level the playing field at home.
Moscow’s readiness to play hardball with its customers, made plain by the New Year’s gas shutoff to Ukraine, which was having a dispute with Gazprom over the price of gas, has made Europeans nervous about doing business with Russia.
Other economic issues got short shrift at the summit, even though economics is ostensibly the G8’s raison d’etre. The communique noted that the leaders discussed high and volatile energy prices, and “reiterated our commitment to address global imbalances, working together to remove distortions to the global adjustment process, promote liberalization of trade and investment, and modernize international financial institutions.” They pledged to resume the stalled Doha Round of global trade talks.
There was also a political checklist. The heads of state called on Iran to end doubts about its alleged nuclear-weapons program or face U.N. Security Council scrutiny and possible sanctions. They condemned the recent North Korean missile launches and urged Pyongyang to return to the six-party talks. They agreed to strengthen cooperation to fight terrorism, particularly in protecting the global energy infrastructure, and to do more to fight infectious diseases.
U.N. Secretary General Kofi Annan reminded the leaders of their commitment, made at last year’s meeting, to increase aid to Africa. There is much more to be done.
Those issues were overshadowed by the deteriorating situation in the Middle East. Days before the G8 summit began, Hezbollah attacked Israeli forces, kidnapped two Israeli soldiers and killed others. Israel responded with a vicious bombardment of Lebanon, from where Hezbollah launches its attacks. The offensive has claimed nearly 300 lives and done extensive damage to Lebanon. More troubling is the prospect of Syria and Iran, both of which back Hezbollah, being drawn into the conflict.
After considerable debate, the heads of state in St. Petersburg released a nonbinding statement on the Middle East, adopted by consensus, which called on Israel to adopt “utmost restraint” while condemning “extremist elements” that encouraged the violence. That statement is likely to have little effect, but that is not a problem: Few G8 meetings produce much of real significance.
The G8’s importance is symbolic. Membership confers status, confirming that a participant is a “leading nation.” This is why there has been controversy over this year’s meeting. Russia is no economic powerhouse and Mr. Putin’s domestic policies, especially the concentration of of power in the executive, are a source of growing concern. Yet Moscow controls considerable energy assets, which afford it a central role in the global economy. Membership in the G8 acknowledges Russia’s potential. But Mr. Putin’s guests should make it clear to the Russian president that he should use his influence and power responsibly, or risk future exclusion.
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