Global financial summit from G7 to G20; new strong voice of BRIC nations: Brazil, Russia, India and China

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Western nations began to cede some control as countries including Brazil, India and China – which with Russia form the so-called BRIC nations – managed to guarantee a greater presence on the international stage.

All three will now join the board of the Financial Stability Forum – the global economic policy powerhouse that to date has been the bastion of the G8.

Each is likely to play a stronger role in the reform of major institutions such as the International Monetary Fund than might previously have been witnessed under the old economic order.

The final summit communiqué also gave particular reference to emerging and developing economies, urging them to undertake commitments consistent with their capacities and roles in the global economy – a clear admission of their increased importance.

Brazilian President Luiz Inacio Lula da Silva noted at the summit that "we are talking about the G20 because the G8 doesn't have any more reason to exist. The emerging economies have to be taken into consideration in today's globalised world."

The G8 nations – essentially the post-war G7 plus Russia – did meet in April to begin to combat the financial crisis but considerably more attention has been paid to the G20 summit due to its scale.

In the past, the G20 has been solely limited to finance ministers and central bank governors of the countries involved, but this is the first time national leaders have been involved.

One of the strongest voices at the summit was Indian premier Manmohan Singh, a former economist, who clearly articulated the need to a co-ordinated global response to the problem that was aimed at all corners of the world.

As a result of his success in increasing India's visibility on the world economic stage, the Indian Express newspaper welcomed what it called the country's "glowing clout" in the world.

Australian Prime Minister Kevin Rudd welcomed the involvement of countries like China and India: "If you look at the impact of the global financial crisis it has begun in developed economies. It has now spread to the developing economies where the impact will be even worse."

Ahead of the summit, the BRIC nations went to the unusual step of issuing their own set of goals for the meeting, following a series of meetings between the four over the last six months.

Going forward, Brazil's President Lula, in his role as president of the G20 until the end of the year, will work with Britain's Gordon Brown, and South Korea's Lee Myung-bak, who will take on the presidency after Mr Brown in 2010, to come up with an agenda for the next G20 leaders summit, likely to be held in London by the end of April.

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Images courtesy of Reuters/Jason Reed, Xinhua Photo, cbc.ca, Asset Plus Fund Management, and Junko Kimura/Getty Images AsiaPac

Original Source: Telegraph UK

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