Rising Powers and Multilateral Institutions

Dries Lesage, T. Van de Graaf, Kenneth A. Loparo, T. Van de Graaf, Thijs Van de Graaf

• Publisher: Palgrave Macmillan
• Year: 2015
• ISBN:
  9781137397607
• Topic: Politik & Internationale Beziehungen
• Subtopic: Handel & Tarife

The rise of new powers such as China and India is sending shockwaves through the global multilateral system. This volume systematically examines how 13 multilateral institutions are responding to this shift, with some deploying innovative outreach and reform activities, while others are paralyzed by gridlock or even retreat from the global scene.

Part I

Introduction

1

Analytical Framework and Findings

Dries Lesage and Thijs Van de Graaf

General context

In the years and decades after 1944, the United States (US) took the lead in constructing a grand liberal multilateral order (Ikenberry, 2001; Patrick, 2009). This US-sponsored global architecture covered both security and economic affairs. Some institutions were created immediately after World War II, such as the Bretton Woods institutions and the General Agreement on Tariffs and Trade (GATT). Others came later and were set up for different reasons – the monetary and oil crisis of the early 1970s, for example, spawned the G7 and the International Energy Agency (IEA). Many of these institutions had a truly global span, and even those that were confined to the Western camp often took on global aspirations after the end of the Cold War.

This has left the international system replete with multilateral institutions that are dominated by a handful of mostly Western countries, yet have a global mission or a desire to shape global outcomes. Examples are the globally operating, but exclusively run, United Nations Security Council (UNSC) and Bretton Woods institutions (International Monetary Fund [IMF] and the World Bank Group). Others are bodies with a constricted membership but visibly global aspirations, such as the Organisation for Economic Co-operation and Development (OECD), the IEA, the G7/G8 and technical non-governmental institutions, such as the London-based International Accounting Standards Board (IASB).

Today, this US-sponsored liberal multilateral order is cracking under the tectonic power shifts that are taking place in the world economy. The rise of new economic powerhouses such as China, India, Brazil and a range of middle powers has stirred a profound debate about the necessity and feasibility of redesigning global governance. Multilateral organizations that aspire to practice global governance but do not give sufficient voice to emerging powers commensurate with their growing economic clout, are increasingly contested. Prime examples here are the UNSC, the IMF and the World Bank, where governance reform has been high on the agenda over the past few years.

At the same time, international organizations and negotiation settings that are more democratic, such as the World Trade Organization (WTO) and various United Nations- (UN) affiliated institutions, including the World Intellectual Property Organization (WIPO) and the UN Framework Convention on Climate Change (UNFCCC), have seemingly become bogged down in deadlock, which many observers attribute to global power transitions. With the advent of the G20 leaders’ summit in 2008, a new forum has emerged in which established and rising powers can discuss issues of common interest or concern on an equal footing. Yet, many observers agree that the G20 has lost much of its momentum since its remarkable success during the 2008–2009 global financial crisis.

Conceptual framework

The concept of “rising powers” has become a standard term in the vocabulary of international relations (IR) scholars to designate the phenomenon whereby a group of large and rapidly growing countries is changing the global power balance. Sometimes related terms are used such as “new powers” (e.g. Narlikar, 2010) or “rising states” (e.g. Alexandroff, 2010), yet we stick with the term “rising powers” because, when considered in macro-historical perspective, some of these allegedly “new” powers are in fact rather “re-emerging” powers, China being the emblematic example here (Nye, 1997). Moreover, not every rising “state” qualifies as an aspiring “major power.” Indeed, there is a long-standing recognition that there exists a distinct group of “middle powers” in world politics, states that are able to carve out niches for themselves in international diplomacy without necessarily commanding the same capacities as the true great powers in the international system (Cooper, 1997).

Numerous efforts have been made in the literature to compile a list of today’s rising powers, often based on complex metrics that take into account behavioral aspects (“the ability to get the outcomes you want”) and power resources (“the possession of the resources that are usually associated with the ability to get the outcomes you want”), including economic growth, military (projection) capabilities and soft power (Keohane and Nye, 1977/2001: 220). In addition, various acronyms have been proposed to capture the shifting power configurations in the international system. The most famous one is the “BRIC” acronym, which stands for Brazil, Russia, India and China, and was coined by Jim O’Neill, economist at the American investment bank Goldman Sachs, in 2001. Analysts sometimes also refer to the “BRICS” (to include South Africa), the “BRICSAM” (to include Mexico) or the “BICSAM” (to exclude Russia). Still others simply talk about “Chindia” (Lloyd and Turkeltaub, 2006) or the “Asian drivers” (Kaplinsky and Messner, 2008).

For the purposes of our book, we adopt a pragmatic and issue-specific definition of rising powers. Our approach is pragmatic since we do not aim to provide an exhaustive list of the rising powers, based on some sort of quantitative measurement (e.g. Armijo, 2007; Young, 2010a). Even without trying to rigorously compare the relative power positions of different countries, we all have a sense of who the rising powers are – China being a prime candidate, followed by India, Brazil and Russia. Yet we refrain from using a specific acronym because we do not want to implicitly suggest that a particular grouping of rising powers (e.g. the BRICS) also forms a homogeneous bloc or a political alliance, neither that there is a fixed group of rising powers. Many of the rising powers face significant challenges, both internal and external, which could one day derail their economic ascent. Without denying the measurable changes that have occurred in the world economy over the past couple of years, one should always be careful not to extrapolate too strongly from current trends, or exaggerate the overall power shift (Young, 2010b; Cox, 2012).

More importantly, we think that power varies significantly with the issue area in question (Keohane and Nye, 1977/2001). For example, large emitters of CO2 wield substantial power in international climate negotiations, since their participation is crucial for the success of any global agreement, given the global public good nature of the climate change threat. Countries that have nuclear weapons do not necessarily have more bargaining power in the international climate negotiations. Conversely, it is hard to imagine how large emitters could translate their bargaining power from the climate arena into the realm of security (e.g. nuclear disarmament talks). In other words, the question of who the rising powers are depends very much on the issue area at hand, and issue-specific power does not translate easily from one area to another. The upshot is that countries may be rising in some issue areas and not in others. In the context of our book, for instance, China is a rising power with regard to international monetary governance and thus demands a louder voice at the table of the IMF, yet it acts more like an established power when it comes to the UNSC, in which it has secured a permanent seat with veto power since 1971.

This brings us to another key concept in the book that merits further clarification: “multilateral institution.” The term “institution” is widely used across disciplinary boundaries, from political science over economics to sociology. Yet a consensus definition is lacking and the concept remains largely elusive, also within the field of IR studies. For some it is little more than a synonym for international organizations – that is, bureaucratic entities with physical addresses and a staff and so on – while others use the term as an umbrella for all international relations. Indeed, as Stein (2008: 207) observes, “if institutions are simply rules of the game, and if all recurrent behavior is guided by some rule, then the entire study of international politics can simply be redefined as the study of international institutions.”

The most common way to define institutions, however, is to see them as “persistent and connected sets of rules (formal and informal) that prescribe behavioral roles, constrain activity, and shape expectations” (Keohane, 1989: 3). Thus defined, international institutions may take the form of bureaucratic organizations (both governmental and nongovernmental), regimes (rule-structures that do not necessarily have organizations attached) and conventions (informal practices). The large majority of international institutions that are under scrutiny in this book take the form of formal intergovernmental organizations. Examples include the IMF, the North Atlantic Treaty Organization (NATO) and the OECD. Yet, according to the aforementioned definition, informal intergovernmental clubs such as the G7/G8 (which, to date, has no official secretariat) and private bodies such as the IASB also qualify as international institutions. Since the institutions that we focus on engage in some kind of policy coordination among at least three national governments, we add the prefix “multilateral” to institutions (Keohane, 1990).

Aims and scope

The principal aim of this volume is to examine the varying effects of the rise of new powers on the institutional architecture of global governance, measured and compared across different types of institutions. Previous studies have discussed the power, preferences and behavior of these rising contenders on a country-by-country basis (e.g. Cooper and Antkiewicz, 2008; Alexandroff and Cooper, 2010; Narlikar, 2010; Young, 2010b; Narlikar, 2013), and the evolving dynamics in different issue areas in world politics (e.g. Klare, 2008). Others have combined analysis of the failings of the current system with institutional proposals, such as the proposal to create an Economic and Social Security Council within the UN (Derviş, 2005). Our book is the first, to our knowledge, to provide a comparative look at how multilateral institutions and negotiations respond, or fail to respond, to the shifting global power configurations.

Moreover, our volume not only includes the usual candidates (WTO, IMF and the like) but also some smaller, more inconspicuous and much less studied agencies like the IEA and the IASB. More specifically, our book deals with three types of institutions. Each type is challenged in different ways by the shifting global power configuration. Over the past decades, and particularly in recent years, most of the concerned institutions have begun to deploy an intriguing set of strategies to cope with these tensions and to adapt. Our research project aims to understand the variance in these outcomes, and to explain common patterns and meaningful differences.

First, our volume deals with a set of international institutions that have a selective Western-based membership, such as the OECD, NATO, the IEA, the IASB and the G7/G8. For these institutions, which often aspire to practice global governance, the challenge is to reach out to rising powers in a structured manner or risk sinking into oblivion. In response, these exclusive Western clubs have deployed so-called outreach policies that vary significantly in character and degree. They range from non-reform and non-committal dialogue with non-members, over sustained, issue-driven cooperation with important outsiders and partnerships with other institutions (such as the UN and G20), to internal governance reform or full-fledged membership expansion.

Second, we study multilateral institutions that have the ambition to shape global governance but in which major players are deprived from equal treatment in decision-making. Examples of this category of institutions include the UNSC, the IMF and the World Bank. The authority of these institutions is increasingly challenged and contested. Some of these institutions have embarked on the path toward internal governance reform (e.g. the IMF and World Bank), although the significance of these reforms is hotly debated, while others remain curiously mired in sclerosis despite decades of governance reform debates and initiatives (e.g. UNSC).

Third, our book looks at a number of multilateral settings in which rising and established powers interact more or less on an equal footing.The cases we look at are the WTO, the recently created G20 and three UN-affiliated institutions: the UNFCCC, the WIPO and the Convention on Biodiversity (CBD). Characteristic of most of these settings is that the negotiations and bargaining processes seem to be bogged down in deadlock, which observers often attribute to the shifting power constellations. The CBD seems to form an important exception to this general pattern, though, as it is one of the few multilateral settings where innovation has taken place in recent years. Through comparative and longitudinal analysis, this aspect of the book studies the sources of why some of these processes have stalled and critically examines the proposed ways to escape from the impasse, including the shifts in negotiating coalitions and attempts to shift the talks to outside forums.

It is important to emphasize at the outset that our focus on rising powers does not mean that we do not pay attention to other categories of countries. Indeed, the concept of “rising powers” itself suggests that there are also “declining powers,” that is, at least, if power is measured in relative terms. Needless to say, the views and interests of those declining states will matter substantially when discussing the adaptation practices across multilateral institutions to changing power configurations. In addition, despite our focus on rising and declining powers, we should not forget about the role of so-called marginalized majority, that is, the non-G20 and non-BRIC states. The poor states in the Global South face an even bigger representation deficit in global governance institutions than the rising powers do, and so our focus throughout the chapters is on the risers, the retreaters and the rest.

Guiding questions

Having developed a set of common definitions of key concepts, including a typology of multilateral institutions, we now outline a set of guiding questions to ensure sufficient consistency across the chapters. These questions are structured in three stages – pressures, responses and interpretations – to which each chapter will speak albeit not necessarily in the same order or to the same extent.

In the first stage, the case studies will seek to identify whether and how the rise of new powers creates pressures on the multilateral institution in question. To that end, each chapter will seek to respond to the question of whether there are, or have been, power shifts in the issue area in which the multilateral institution operates. Then the rising powers in that particular area will be identified, and the contributions will shed light on t...