José Manuel Barroso, the president of the European Commission, yesterday (14 November) said Europe should be proud of becoming a model for the rest of the world at this "turning point" in world history.
"I believe no one is better prepared to shape globalisation than Europe, with its values, its unique spirit of supranational rules and supranational principles," Barroso said, adding that Europeans should be proud of this.
At the summit, however, other European leaders are expected to steal the show. French President and EU presidency holder Nicolas Sarkozy recently took the lead, managing to achieve consensus on a common EU position following a recent extraordinary EU summit (EurActiv 07/11/08).
Speaking yesterday about the forthcoming G20 summit, Sarkozy said the US dollar could no longer be the only currency in the world. "I am leaving tomorrow for Washington to explain that the dollar - which after the Second World War under Bretton Woods was the only currency in the world - can no longer claim to be the only currency in the world. What was true in 1945 cannot be true today," said Sarkozy at a ceremony during which he was awarded a prize for political courage, at the risk of alienating his American host.
UK Prime Minister Gordon Brown is also expected to maintain a high profile at the G20 summit. The banking sector bailout in Britain largely became a model for EU-wide action, and Brown was confident that he would "send a message to the world" with his "international programme" for strengthening the global financing system, which he termed a "new Bretton Woods" (EurActiv 15/10/08). The British leader even claimed on Tuesday (11 November) that an agreement on the long-stalled Doha round of world trade talks could be reached within days.
Bush against government intervention
As if he was pre-empting Europe's newly-found ambitions, George W. Bush advocated free market capitalism in a speech yesterday, calling it "the highway to the American Dream". He advised against government regulation as advocated by European powerhouses.
"We must recognise that government intervention is not a cure-all. For example, some blame the crisis on insufficient regulation of the American mortgage market. But many European countries had much more extensive regulations, and still experienced problems almost identical to our own," said Bush.
However, the forceful image Europe is trying to put in place could be undermined by the entry into recession of Germany, the largest EU and eurozone economy and third biggest economy in the world. But the OECD (Organisation for Economic Cooperation and Development) also slashed its economic forecasts for the entire 30-nation zone, which comprises the US and Japan.
US U-turn
The situation is further complicated by a surprising U-turn by the Bush administration, which has dropped the centrepiece of the $700 billion financial rescue package approved by Congress less than two months ago: a plan to buy up troubled mortgage-related securities.
Indeed, Treasury Secretary Henry Paulson said the US government would rather buy stakes in financial institutions instead of buying troubled assets from banks. These statements did little to reassure markets in the US and worldwide.
Absent and present
President-elect Barack Obama will not take part in the summit directly, but has dispatched former Iowa Congressman Jim Leach and former Secretary of State Madeleine Albright to attend. Many observers claim that without Obama, the decisions taken in Washington will count for little.
In the meantime, France played a game of musical chairs to get Spain and the Netherlands to attend the summit, where in principle only four EU countries – France, UK, Germany and Italy, were expected to attend. After long discussions with its US hosts, France, which holds two seats – one in a national capacity and another as the EU presidency, gave one of the chairs of its national seat to Spain and the other to the Netherlands.
And since Spain and the Netherlands would not be entitled to have their flags displayed, instead having to sit behind the French flag, Sarkozy decided to replace it with the EU flag.
