Tuesday, December 12, 2006


2007 agenda - socialise globalisation?

The 'developed' world will suffer a decline in wages for about 40 to 50 years.

"Professor Freeman [of Harvard] estimates that the entry of China, India and the former Soviet bloc into the world economy resulted, by 2000, in a doubling of the number of workers to nearly 3bn. . . Eventually the labour surpluses in the emerging countries will be used up and competition for workers will drive wages up. The question that faces the rich countries is "when?". Professor Freeman estimates 40 to 50 years. In between there will be downward pressure on many kinds of wage earner in the west." reported the FT on 20 October, 2006 after seeing the academic paper.

The FT's Samuel Brittan suggested that debates are needed on what lies ahead. For example, governments might be persuaded to favour labour more than capital, and labour standards in the global economy could be raised.

Of course, since October 2006 popular dissatisfaction with the ruling party in the United States has caused much political control to move to the Democrats. Policy changes in the US may be expected.

G8 2007

Germany is president of the G8 for 2007. The tentative agenda is said to include energy, the freedom of investment, the social dimensions of globalisation and Africa. Source

The proposal by some, including the UK, to extend G8 membership to China, India, Brazil, South Africa and Mexico was rejected. However these countries will all be invited to the summit.

Moreover, from January 2007, Germany will triple share the EU presidency for 1.5 years with Portugal and Slovenia. Source

The Chinese press report some of the stresses in the G8:

"The EU is carefully seeking a balance between its increasing need for Russian energy supplies, and its criticism of Moscow over human rights and other ideological issues. But the divisions among its 25 members, over how to handle Russia, have not made the task any easier." China View


And on energy: "Moscow had no intention of observing guidelines in the EU's energy charter that would allow non-Russian companies access to the country's vast pipeline network. . . Russia's insistence that it will not ratify a set of common rules giving European and other foreign companies access to the pipelines could pose the first challenge for Chancellor Angela Merkel when Germany takes over the EU's rotating presidency on Jan. 1 [let alone presidency of the G8]."

On freedom of investment, Europe complains:
"While Russia stops foreign companies from gaining access to the energy grids, Gazprom is not stopped from distributing its gas in EU countries. . . Where is the reciprocity?"

A response came yesterday from President Vladimir Putin's special envoy to the European Union. He said Russia would never give up control of its pipelines. His statement coincides with increasing pressure from the Kremlin on foreign energy companies to reduce their stakes in Russia's energy sector. IHT

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