G8 vs G20

Posted: March 3, 2013 in Current affairs
Tags:

G8 vs G20

The G8 and G20 are coalitions of nations which addresses significant international issues. The predecessor of both coalitions was the G7, a group of seven nations which banded together in 1975 to oppose the 1973 oil embargo by various Arab nations. The embargo was put into place by the Arabs as a protest against the intervention of the United States and the United Kingdom during the Yom Kippur War. The Arab nations waged war with Israel, but were unsuccessful because the United States and United Kingdom provided Israel with weapons and military might.

The U.S.S.R., which was by then on the verge of breaking up, supplied the Arab nations with weapons, and because of this move was not included in the G7. The G7 was formally known as the Group of Seven Industrialized Nations. It was composed of Britain, United States, France, Canada, Japan, Italy, and Germany. The G7 was renamed as the G8 during 1997, when Russia added to the original seven-country lineup. Ever since its inception, the G7 and G8 asserted several political and economic policies which affected other countries.

The G7 and G8 became known in the international scene as the major policy-makers which can enforce or disrupt political and economic stability. The latest installment of the G8 is called the G20, a greater coalition formed in 1999 which includes the nations of Brazil, China, Saudi Arabia, Republic of Korea, France, Australia, China, Canada, Germany, Indonesia, Argentina, Turkey, India, Russia, South Africa, Mexico, Japan, United Kingdom, United States, and the European Union.

While the G20 is supposed to acknowledge all members as equals, it cannot be denied that the countries which were included in its predecessor, the G8, have an advantage over other countries in terms of political and economic policy-making. So far, the economic policies that the G20 decided for the 2010 include rules to improve bank capital, strict disclosure of compensation policies, and the setting aside of portions of compensation for performance and risk. All of these are economic measures which the G20 believes will alleviate any future economic crisis.

There are many theories while the G8 chose to include other countries in the coalition. The first theory is for economic reasons, since many of the newly-added countries are developing countries which have great potential in the future to sway the world economy, especially the emerging powerhouse economy of China. By inviting China to into the G20, other countries can intervene directly in China’s economic and political affairs and benefit from its huge economic capability. Another theory is based on the current economic crisis faced by Western countries, especially the United States and the United Kingdom. Many of the countries invited in the G20 came from the East, such as Saudi Arabia, China, and South Korea, which could offer aid in the form of monetary debts to the fledging economies of the West.

Summary:

1. Both the G8 and G20 originated from the G7, a seven-nation strong coalition which includes Britain, United States, France, Canada, Japan, Italy, and Germany.

2. The G7 was formed in order to counter the oil embargo imposed by the Arab Nations due to the intervention of the United States and United Kingdom in the Yom Kippur War. The G7 influenced international economic and political decision-making.

3. In 1997, Russia joined the ranks of G7, and the coalition was renamed as the G8.

4. In 1999, the G8 added sixteen other nations, and the coalition was renamed as the G20. Emerging economic powerhouse China, along with two other Eastern nations, Saudi Arabia and South Korea, were the most notable additions in the coalition. Currently, the G20′s aims focus on alleviating the effects of present and future economic crises.

 

Advertisements

Comments are closed.