BY JOHN SOLYMOSSY
Chinese government leaders will not take part in either the G-8 or NATO summits, though the growing importance of China in the global economy is the 800-pound gorilla in the room at both forums.
Several countries currently included in the G-8 “club,” such as Italy, Canada and France, have faded in importance globally even as China’s influence has soared. Many experts believe for the G-8 to remain an influential and important organization, it will have to consider how China might fit into its global alliance.
On the other hand, Scott Kennedy, a political science professor at Indiana University, believes that China’s exclusion from the G-8 and NATO has signaled the rise of importance of the G-20 alliance.
“The G-8 is a group of wealthy democracies, who also happen to be military allies. China doesn’t fit in either group [NATO included],” Kennedy said. “A recognition of the problem of China not fitting in the G-8 was the creation of the G-20, which is now much more important in discussing global economic issues than the G-8.”
The G-20 is a group of 19 countries and the European Union that was formed to build a working relationship between economically well-established countries and emerging countries. China along other emerging economies, India and Brazil, are included in the G-20 group.
One of the main items on the agenda for both summits is the economic struggle of European union countries as well as the United States. China’s meteoric economic development over the past 10 years has led countries such as the U.S. to develop a significant dependence on China’s economy. The U.S. trade deficit with China increased three-fold in the past decade, reaching $295.5 billion at the end of 2011.
According to a study produced by HSBC, a global banking and markets company, China eventually will rise to the top as the world’s largest economy. The study states, “There will be a marked decline in the economic might of many small population, aging, rich economies in Europe.”
China had more than $3 trillion in foreign currency reserves as of 2011, which makes it the world’s biggest lender, even larger than the World Bank in loans to developing countries.
Even so, China is not immune to global trends and the nation with the world’s largest population posted a global trade deficit in February and has been hurt by the economic problems in Europe and the economic slowdown last year in the United States.
The one major roadblock for China’s inclusion to the G-8 has been that it is not a democracy. However, the emergence of China’s economy and its future as a global juggernaut should transcend the political affiliations of the G-8 club as their dependence on China continues to grow.