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News Features  


 

Lanka heads powerful G-15 serving collective interests
History and membership

The Group of 15 (G-15) was formulated at the Ninth Non-Aligned Movement Meeting in Belgrade, Yugoslavia in September 1989. The Group was set up with the goal of fostering cooperation and to providing input for other international groups, such as the World Trade Organisation and the Group of Eight (G-8) rich industrialised nations. It is composed of countries from North America, South America, Africa, and Asia who share a common goal of enhanced growth and prosperity. The G15 focuses on cooperation among developing countries in the areas of investment, trade, and technology. The membership of the G15 has expanded to 18 countries, but the name has remained unchanged.
The countries representing the G-15 from Africa are Algeria, Egypt, Kenya, Nigeria, Senegal, and Zimbabwe. The countries from Asia are India, Indonesia, Iran, Malaysia, and Sri Lanka. The countries from Latin America are Argentina, Brazil, Chile, Mexico, Peru, Jamaica, and Venezuela.

By Tharindu Prematillake
Sri Lanka will host the next G-15 summit in 2012. At the recently concluded G-15 summit held in Tehran, Iran, President Mahinda Rajapaksa took over the chairmanship of the Group from the President of Iran, Mahmoud Ahmadinejad.
The Minister of External Affairs Professor G.L. Peiris was part of the delegation that represented Sri Lanka in Teheran. The Nation spoke to the minister to understand Sri Lanka’s role in the G-15, and the significance of getting the opportunity to host the next summit.

Following are the minister’s views:
“President Ahmadinejad said that the things that the G-15 believes in, the policies that they want to implement which are embodied in the official documents that were prepared and adopted, including the final communiqué signed on May 19, have already been achieved by Sri Lanka.”
“President Ahmadinejad, speaking from the chair just before handing over the chairmanship to President Rajapaksa, said, “All of this has been accomplished in the ground in Sri Lanka. What we are talking about are things we want to achieve, they are ideals, and they are things that we want to work towards, things that we aspired to, but when we look at Sri Lanka’s empirical experience in the last couple of years these have all actually been achieved on the ground’. Then he said that is the reason why President Rajapaksa achieved such a resounding victory at the two major national elections in Sri Lanka. That was a very worthwhile tribute, and it encapsulated the feelings of the G-15 leaders.

“Earlier, Sri Lanka was looked at as a country which had serious problems that was throwing down our economic development. So how Sri Lanka dealt with that problem, starting with the eradication of terrorism, focussed on the development of the economy, how we are getting at the institutions for reconciliation, constitutional reforms in harmony with policies that need to be pursued in the post conflict stage, and how all this has been done sequentially and methodically won the praise of the leaders of the leaders of the G-15”.

Benefits
“The benefits to Sri Lanka are evident when you look at the nature of the organisation. Among G-15 countries, three countries are rated as the largest economies in the world. Those three countries are Brazil, Iran, and Mexico. They are among the top ten. They account for 25% of the crude oil resources in the world. They account for 27% all export trade in the developing world, and 30 percent of import trade in the developing world”.

“The benefits are the following. There are of two levels, one is bilateral the other is multilateral”.

Bilateral relations
“When we talk about bilateral relations the affinity or closeness that comes from a grouping of this nature means that these countries will work together much more closely than they would otherwise. The reason for that is a commonality of interest. We must understand the nature of the global situation. The world is coming out of an economic recession. Many countries are now trying to benefit from that situation. The perspectives of the developing world are different from the perspectives of the developed countries. The developing countries in order to derive the maximum benefit from that situation will have to formulate and implement policies which are collectively designed to further their interest which is collectively different from the interests and the aspirations of the developed countries. So here is a powerful group of countries coming together for the purpose of more effectively organising themselves in order to pursue the strategies and objectives which will serve their interests collectively. Against that background there would obviously be a tendency for these countries to work closely together”.

“A series of bilateral agreements are entered into. For example with regard to food security and energy security and terrorism they will therefore, have a considerable incentive to work closely with each other and for that purpose enters into bilateral agreements”.
“The summit gives us the opportunity to strengthen already existing strong relations with some countries such as India while also enabling us to develop stronger ties with other countries.”
“For example, our bilateral relationships with Iran are becoming very strong. We have several high profile projects which are directly supported by the Iranian government. The Uma Oya, which is one of our major irrigation projects, the value of which is approximately 535 million US dollars, is being supported by the government of Iran. Of equal importance to Sri Lanka is the rural electrification project which will benefit more than 1000 villages. The value of that is around 67 million Euros. For that around 65% of the capital required will come from the Iranian government. Now we are also negotiating with Iran to finalise the arrangements with regard to the Sapugaskanda oil refinery. That is a very large project of which the total cost is around 1.5 billion US dollars. There again the Iranian government has undertaken about 70% of the cost. Sri Lanka appreciates the fact that during the oil crisis Iran helped us by providing us capital to purchase oil which was interest free for several months.”

“Brazil is by far the strongest economy in South America. It amounts for around 60% of trade in South America. President Lula da Silva was at the summit. That’s a country we want to develop more relationships with. We export a lot of spices to the South American continent. It is one of the major buyers of our cinnamon. Sri Lanka produces about 80% of the world’s cinnamon. We export cinnamon of high quality and a lot is sent to markets in Mexico and Brazil. That is something that we can develop more on. There are countries which have started exporting their apparel products to Brazil. Therefore, we can look into trade relations in that sector as well. We can also think of developing the services sector.”
“Of course, we won’t foresee our traditional friends. But that does not mean we should ignore new markets.”

Multilateral relations
The other advantages arise from the benefits that are derived by multilateral relations. For instance, there was a proposal for the establishment of a G-15 bank. In many of these countries the quality of human resources is high, people are creative and they have good ideas. What they lack is access to capital. So the G-15 bank would be helpful.
One of the objectives of the G-15 is the reform of the Breton Woods institutions what is called the international financial architecture. That is a reform of the World Bank and the International Monetary Fund. That would collectively benefit the G-15 countries because that would mean a stronger voice for the developing world. Not only stronger voices but there are specific concerns and priorities to be reflected in the decision making processes of the Breton Wood institutions.

One of the themes of this year’s summit was micro-credit. That is to enable the rural hinterland in many of these countries to benefit from the proliferation of industries, livelihood and income. There the idea was to develop a collective strategy.

There was a lot of emphasis on achieving economic development without the degradation of the environment. Some of these countries have considerable economic power. How those countries work together in order to enable environment friendly sources of energy to be developed was discussed. There were lots of discussions on solar power, wind power and reducing dependence on thermal power.

Sri Lanka can also benefit from another theme which is the reform of the intellectual property regime. Many of these countries are interested in the access to international markets. That is very important to them. The shift is from aid to trade. They don’t want to be totally dependent on aid from the developed world. What they want is unimpeded access to their goods in the international market without undue protectionism and restrictions. These countries produce goods of high quality and they have creative populations. So that means the developing nations want to play a role in the intellectual property context like patents, trademarks and copy rights which have traditionally been formulated in keeping with the interests of the developed world. Originally it was the interests of the first world that were intended to be protected and fortified by the intellectual property regime. Now the developing world has interests of its own. For those to be taken into account, collective strategies need to be formed in order to achieve those objectives.

G-15 is not just a talk shop. It is doing good work that is directly beneficial. Now Sri Lanka is the chairman, and the next meeting will be held in Colombo in 2012. In the meantime we have to run the secretariat and give leadership. Already, we have started that work. Sri Lanka’s stature on the world stage is also considerably enhanced by the fact that we have now assumed leadership of this prestigious group.

The other thing that is worth mentioning is that it was decided in Tehran that one of the things that G-15 need to do is to enter into dialogue with G-8, that there must be a bridge, a nexus between the developing countries and the developed countries. Some of the members of the G-15 are also members of the G-20. There was a feeling that those who are members of both groups have a special role to play in establishing direct contact with G-8 and to ensure a sharper focus on the interests of the developing world.