WORLD

Dialogue in Denver

JOHN KIRTON June 23 1997
WORLD

Dialogue in Denver

JOHN KIRTON June 23 1997

Dialogue in Denver

WORLD

ESSAY

JOHN KIRTON

This week, Prime Minister Jean Chrétien will jet into Denver for the 23rd annual Group of Seven summit of the world’s seven leading industrial democracies. Drained and distracted by a federal election in which foreign policy was barely discussed, Chrétien will have to mount a major last-minute effort if the summit is to help him advance his priorities for his second term. The odds might appear to be against him. But his own personal skill as a G-7 veteran and Canada’s power—more formidable than it may seem—make it possible that Chrétien can still turn the summit into a substantial success for Canada.

His host, U.S. President Bill Clinton, will do little to help him. The President, beleaguered by Paula Jones’s lawsuit and campaign financing scandals, has set a new record for late preparation.

The location of the June 20 to 22 meeting has just been changed from the Denver Museum, with its backdrop of dinosaurs, to the visually more modern Denver Public Library. Clinton will certainly arrive to host his summit better prepared than Ronald Reagan who, the night before he chaired the G-7 at Williamsburg in 1983, set aside his briefing books to watch The Sound of Music yet again. But Clinton has allowed the Denver agenda to emerge as an unco-ordinated collage of others’ concerns: VicePresident AÍ Gore’s enthusiasm to strengthen the Rio conventions on global environmental protection; Congress’s desire to transform Africa into a new Asia through freer trade with America; and Japan’s anxiety about its rapidly aging society.

Clinton’s one personal priority has been to defer to incessant Russian demands for greater G-7 participation. President Boris Yeltsin was firmly told “no” when he asked Chrétien if he could arrive early at the Halifax summit of 1995 to inspect fishing boats, which Russia presumably lacked. This time, Clinton has allowed Yeltsin to come at the

John Kirton is director of the G-7 Research Group at the University of Toronto.

very start and stay to the end of the newly christened Denver Summit of the Eight. A G-7 summit that has, since its 1975 inception, often served as the centre of global economic leadership could thus be transformed into a political pageant designed to feed Russian pride and great-power pretensions. Russia’s enhanced presence has left no more than an hour and a half for the seven leaders to confront such serious economic issues as Europe’s force-fed march towards a single

Canada will have special clout at the G-7

currency on Jan. 1,1999, and a financial crisis building in Japan. That is the only session that Yeltsin, not known for his sober reflection on economic issues, will be excluded from.

Chrétien, who has long demanded—and successfully delivered at Halifax—a businesslike “Chevrolet” rather than a pomp-filled “Cadillac” summit, may be privately relieved that so little of substance is demanded of him this time. He does have, however, some important issues to press. Canada above all wants the G-7 to remain an effective forum for managing the global economy. It also looks to Denver to deliver the global forestry convention that George Bush’s G-7 promised in Houston in 1990 to complete by 1992. And it wants this summit to reform the United Nations by getting America, the G-7’s biggest deadbeat dad, to finally pay its membership dues. Cash-strapped Canadians will still hear the G-7 leaders mouth the mantra of “fiscal consolidation”—G-7-speak for cutting government budgets in the hopes that the promised jobs and growth will flow someday. G-7 leaders, however, will also call for another jobs conference that could help Chré-

tien grapple with Canada’s persistent unemployment problem. And they are likely to endorse Finance Minister Paul Martin’s conviction that Canada, along with its G-7 colleagues, must start immediately to reform its pension system if it is to be sustainable over the long term.

To make these Canadian positions prevail at Denver, Chrétien can deploy a formidable array of assets. With his fresh, fully national mandate, he stands as a political genius next to the scandal-plagued Clinton, France’s failed early-election gambler Jacques Chirac, Germany’s moribund Helmut Kohl, and a Yeltsin who cannot convince his fractious legislature to keep Russia’s arms control commitments. Chrétien, with his now more muted separatist threat, even looks good at the moment beside Britain’s boy wonder Tony Blair and the still-active IRA.

Canada can also use its deeper strengths in Denver. For it is truly a principal power in a way that Russia, with its stagnant economy, burgeoning debt and rusting nuclear arsenal, can only hope to be. The World Economic Forum this year ranked Canada as the world’s fourth most competitive economy, second only to the United States among the G-7. Canada, with growth of 3.4 per cent in the first quarter of 1997, is now finally delivering on international predictions that it will be the G-7’s growth leader. It is firmly on track to become the first of the seven to eliminate its national budget deficit and begin to lower the accumulated debt.

There are a few persistent problems. Canadian companies had stagnant productivity over the past two years. Unemployment at 9.5 per cent is almost double the U.S. figure. But the structural foundations for Canada’s long-term success clearly exist. Its aerospace industry should start the next century as the world’s fourth-largest. Thanks largely to immigration, Canada has the G-7’s youngest population and is thus best positioned to finance its ballooning public pension and health-care costs. Last week, for the fourth year in a row, the United Nations ranked Canada tops in its Human Development Index, based on standard of living, life expectancy and education levels. Completing the potent trilogy of technology, population and resources is Canada’s environmental advantage; it has the world’s second-largest per capita stock of “ecological capital,” which includes biological diversity and clean water as well as oil and minerals. As Chrétien reflects on his country’s condition amid the rarified air of Denver, this cornucopia of clout could well be enough to inspire a Rocky Mountain high.