World needs more than crumbs from G7’s table

By MARK MALLOCH-BROWN

The Group of 7 summit in Germany ended last week with leaders of the world’s richest countries pledging to support Ukraine for “as long as it takes.” They agreed on short-term measures such as banning imports of Russian gold and discussed what the meeting’s host, Chancellor Olaf Scholz, called a “Marshall Plan” for Ukraine, invoking the expansive post-World War II reconstruction of Europe. It will be a “task for generations,” Scholz said. There is no question that Ukraine should receive that help. But the Group of 7 leaders are missing the bigger picture. And it’s terrifying. Even before the Russian invasion of Ukraine, global food prices were near record highs. But the ripple effects of the war now threaten to cause hunger and suffering on an enormous scale.

Besides food prices, crude oil breached $120 a barrel recently, fertilizer costs have soared, and interest rates have shot up. Add in extreme weather, unsustainable farming practices, high debt in many countries, lingering effects of the pandemic and other violent conflicts, and more than a billion people are at risk from what the United Nations has called a “perfect storm” of hardship.

And yet members of the Group of 7 failed to respond with anything like the level of commitment required to stave off a human catastrophe. The summit’s headline announcement was $4.5 billion for food security — a fraction of the $22.2 billion that the World Food Program needs now, and a minuscule pledge for a bloc that accounts for around 45 percent of global GDP. The world needs a Marshall Plan. It got a Band-Aid.

The rich-country disconnect was evident in the format of the Group of 7 summit, held in a luxury resort and spa nestled in the Bavarian Alps. The leaders of Argentina, India, Indonesia, Senegal and South Africa were invited to discuss problems such as food, health and climate, but just 90 minutes of the three-day gathering were devoted to those concerns. By treating the global food, energy and debt pressures as secondary to the war in Ukraine, the Group of 7 missed a golden opportunity to help the world’s hungry and disprove Vladimir Putin’s narrative of the liberal world order as a spent force that cares nothing for the poor.

Rich countries may already be losing that battle for hearts and minds. Three months ago, the Western world mustered global support for a U.N. General Assembly resolution condemning Russia’s invasion of Ukraine, with 141 countries voting in favor. But even then, China, India and half of Africa abstained. As the war has progressed, the West has found it more difficult to rally the world, with subsequent resolutions drawing fewer votes partly out of concern that further measures to punish Putin could add to the global economic volatility. President Volodymyr Zelenskyy of Ukraine has been feted in the West, addressing the U.S. Congress and several European parliaments. But when he addressed the African Union by video in June, only four of its 55 leaders followed it live.

This does not necessarily mean support for Russia’s invasion — a number of African countries fear the territorial ambitions of their own stronger neighbours. Nor does it signify a unified stance. Concerns across the Global South are diverse and complex. They include fear of being drawn into a new Cold War, anger over the developed world’s failure to deliver on promises of vaccines, debt relief or climate finance, as well as perceived Western double standards in calling for global action on the war in Ukraine while de-prioritising the suffering of other countries.

But the levers of the same Western market-oriented system that attracts opprobrium in the Global South could provide solutions that developing countries desperately need. Driven by supply fears, at least 23 countries have imposed bans on food exports, further driving up prices. The Group of 7 called on nations to avoid excessive food stockpiling. But it also could have committed to making a concerted push at the World Trade Organization for measures to keep export markets open.

It’s not just about food shortages. Sixty percent of low-income countries are struggling with debt. Again, Group of 7 leaders could have announced plans to persuade the International Monetary Fund to suspend debt repayments, remove borrowing limits and accelerate fresh lending to help countries buy imported food and energy.

The Group of 7 members agreed to study possible price caps on Russian oil and gas to ease inflationary pressures and limit Putin’s ability to fund the war. That effort is likely to run into a host of political and technical difficulties but is worth exploring, along with expanding supply from other sources.

Of course, the most critical long-term step regarding energy is the transition to renewable sources. Climate change affects food security because changes in weather and soil can limit a country’s ability to grow crops. The Ukraine war also has laid bare the security risks of fossil-fuel addiction, which gives leaders like Putin leverage. The energy transition plans of one of the current skeptics of the West, South Africa, indicate the scale of the challenge. Funding will come from a mix of public and private capital. But switching from coal to renewable energies like solar, wind and hydropower will cost some $250 billion over the next three decades, around 3 percent of South Africa’s GDP.

This public-private template could be replicated in other major economies such as India, Indonesia and Vietnam. But that means raising funds on the scale of the Marshall Plan, in which the United States contributed around 2 percent of its GDP to help rebuild Europe.

Western countries and institutions need to muster the same political will to show that they can respond dynamically to help countries at risk and prove that the international liberal order remains a global force for good. Members of the Group of 7 missed a chance in Germany. But it’s not too late.

Malloch-Brown is president of the Open Society Foundations and a former UN deputy secretary general

The New York Times