EVIAN, France, 4 June 2003 — The world’s eight leading industrial powers voiced confidence in an economic recovery yesterday at the anticlimactic end of their annual summit, which was dominated by efforts to patch up differences over Iraq.
In a final statement, the Group of Eight nations focused on the need to press ahead with structural reforms and greater flexibility in the rich nations’ economies despite resistance highlighted by public sector strikes in host country France.
Although the statement did not mention currencies, French President Jacques Chirac said all agreed currency stability was a key factor for growth and were monitoring market movements closely after the dollar’s recent sharp fall against the euro.
The leaders sought to close a bitter trans-Atlantic dispute over the recent US-led war on Iraq, which half the G-8 opposed, saying all now agreed the time had come to reconstruct Iraq.
“Major downside risks have receded and the conditions for a recovery are in place,” the leaders of the United States, Japan, Russia, Germany, France, Britain, Italy and Canada said in a statement issued a day after US President George W. Bush left the summit early for Middle East peace talks.
“We are confident in the growth potential of our economies.”
Economists said the summit conclusion was not just wishful thinking. “There are some grounds to be more hopeful with regards to the recovery process,” said Audrey Childe-Freeman, European economist at CIBC World Markets in London.
Several thousand demonstrators blocked the main bridge over the Rhone river in the Swiss city of Geneva, 40 km (25 miles) from the summit site, and clashed for a third night with police. The G-8 talks were held behind a massive security cordon at the French spa town of Evian, on the other side of Lake Geneva.
Chirac apologized to the Swiss people for the violence in Geneva and Lausanne by “gangs of thugs and wreckers” who he said were not true critics of globalization but simply vandals.
The White House said Bush had expressed support for a strong dollar to the G-8, but foreign exchange markets, uncertain about Washington’s true intention, were largely on hold awaiting an expected European Central Bank interest rate cut on Thursday.
Prime Minster Junichiro Koizumi said Japan’s yen was overvalued and backed a strong dollar.
Chirac sought to give the summit a special emphasis on development in poor countries, inviting an expanded cast of leaders from Africa, Asia, the Middle East and Latin America, all of whom coincidentally opposed the war in Iraq.
He challenged Bush to invite the major developing nations to next year’s G-8 in the United States to keep the spotlight on issues such as fighting deadly epidemics, improving access to clean water and reducing Third World debt.
But Western and African development campaigners voiced deep disenchantment at the meager outcome of the Evian summit. “Not only are there no firm commitments, even their rhetoric is watered down compared with last year,” said Phil Twyford of British charity Oxfam. “Trade is missing in action.”
The G-8 leaders acknowledged the “slow pace” of relieving the debt crippling many African countries, but offered little more than encouragement.
President Olusegun Obasanjo of Nigeria said there had been “little giving, too late,” and his South African counterpart Thabo Mbeki said African nations were deeply unhappy at the pace of relief.
Mbeki and Obasanjo were among five African presidents asked to the summit, the others being from Algeria, Egypt and Senegal. Obasanjo told a press conference Sunday that they were “satisfied” with the progress in realizing last year’s ambitious goals. But overall, the Evian summit produced “no funding commitments whatsoever, no concrete timelines,” said Sonali Thakkar, an analyst at the Canada-based G-8 Research Group.
“All Africa takes away from this meeting is a fistful of conditional offers and post-dated checks,” accused Abimbola Akinyemi of ActionAid Nigeria.
And a joint statement of African unions and non-governmental organizations charged that “the political will of the eight most powerful countries to meet their obligations to Africa has simply dried up.”
Chirac, however, said he had seen “no risk of deflation” in Europe or the United States. The G-8 also reiterated a commitment to meeting the objectives “and overall timetable” of the Doha WTO declaration calling for a reduction in global trade barriers by the end of 2004.
The Doha declaration, adopted in the Qatari capital in November 2001, launched a new round of multilateral trade liberalization talks that are currently foundering on disputes over the elimination of agricultural export subsidies, the provision of generic drugs to poor countries and other issues.
