The Death and Return of Middle Power Influence in Global Governance

Andrew F. Cooper
Professor, Department of Political Science, University of Waterloo/BSIA Distinguished Fellow, CIGI

Global power structures are continuously in flux. Changes in the international or domestic environments can elevate a member state to a higher level of prominence; or diminish it in terms of its place in the hierarchy of nations. The force of structural dynamics, in other words, can be tempered by agency – the actions of leaders – in terms of diplomatic performance and/or institutional location.

In structural terms traditional and non-traditional middle powers are highly vulnerable to ‘downgrades’ in the international system. Whether all the optimism surrounding the projection of influence as a result of the economic weight of the BRIC states – that is to say the biggest of the emerging market states, China, India, and Brazil – is warranted or not, it is these states that are associated with a rising presence in international relations. Bigness, in terms of dimensions such as market size, proportion of FDI, and export profile in all of these countries is linked explicitly to their appearance at the ‘high tables’ of international relations.

The gap between the BRIC states and middle powers is highlighted by the GDP of these states. As compiled by the IMF the comparative data for 2010 put China’s economy at 5.878 trillion of USD – highest amongst the BRIC states, followed by Brazil at 2.090 trillion, and India at 1.631. By way of comparison, traditional middle powers (Canada and Australia and also some European Union states) and a cluster of non-traditional powers (Mexico, Republic of Korea, Indonesia and Turkey) lag well behind. Canada’s GDP is calculated to be 1.577 trillion, Australia’s 1.237, Mexico’s 1.034, Korea’s 1.014, Turkey’s .735 and Indonesia .706 trillion.

Examining the dimension of diplomatic capability – the area of comparative strength for the middle powers –notably acting as go-betweens – has been eroded by ambitious and skilled smaller states (Qatar serves as an excellent up-and-coming illustration) and non-state actors alike. This squeezing of the role of middle powers demonstrates that the “rise of the rest” in global affairs is misleading. This contemporary kaleidoscopic perspective – though valuable as an antidote to US-centrism – misses the degree to which in the 21st century has become a new arena of “hierarchical competitiveness”. The ‘Rise of the Rest’ as chronicled by journalist and public intellectual Fareed Zakaria in his book The Post-American World (Zakaria, 2008) does not create uniformity but leads instead to differentiated layers of member states in the international system.

The image of the ‘middle state’ in decline is accentuated by other important factors. In a world of diminished US dominance, it is much harder for middle powers to take on a repertoire of familiar activities. At the end of the Cold War, I co-authored a book titled Relocating Middle Powers (Cooper, Higgott and Nossal, 1993). The major theme was an optimistic one: Within some basic boundaries and guidelines, middle powers seemed to the authors to have an ascendant future. The course forward seemed to involve dualistic and even paradoxical components. On the one hand, in a unipolar world, middle powers were pushed to play the role of followers – whether in the security domain (the first Gulf War), the economic arena (the move from the GATT to the WTO) or on social issues (human rights, democratization). On the other hand, in select niches, middle powers had gained considerable ‘political space’ and incentive to form coalitions that took on the US in a number international policy areas – land mines, the International Criminal Court and child soldiers.

With the ascendancy of the new ‘Bigs’ (the BRIC states) and also with the emergence small agile states, middle powers appear to have been ‘squeezed’ and their influence markedly reduced. In some institutions, notably the WTO, traditional middle powers such as Canada have been eased out of informal groupings at the core of negotiations. In the IMF middle powers in the EU including the Netherlands and Belgium are facing pressure to re-calibrate votes and shares as well as their leadership of established constituency groups. Furthermore, middle power success in the competition, for example, for prized UN Security Council non-permanent seats can no longer be taken for granted. Canada’s 2010 loss to Portugal, a country – despite its imperial past – campaigned as the champion of small states. Australia struggled in a campaign against Luxembourg – a member of the so-called 3G group – for membership in 2012.

The middle power image of being ‘squeezed out’ or marginalized is not the complete picture however. Experts have revived an interest in analyzing middle power capacity in the 21st century. With a focus on structural attributes relating to economic/demographic weight, a number of reports have pointed to the generalized appearance of an ‘emerging middle’ in the global economy. Goldman Sachs has conceptualized a Next 11 featuring a lengthy list of countries ((Bangladesh, Egypt, Indonesia, Iran, Korea, Mexico, Nigeria, Pakistan, Philippines, Turkey and Vietnam) (Goldman Sachs, 2007). Other analysts from the investment industry have tweaked this concept of a new middle – either as CIVETs (Colombia, Indonesia, Vietnam, Egypt, Turkey and South Africa) or MIST (Mexico, Indonesia, South Korea and Turkey).

Yet, consistent with the critique of the “Rise of the Rest” some middle powers have a combination of resources, diplomatic opportunities and skills that mark them out as a privileged cluster. In structural terms, GDP is not the only salient quantitative indictor of a country’s standing. As China’s political leaders continue to declare, China is not only a rising power – but a declared poor country. In terms of GDP at PPP per capita, China falls behind not only other members of the G7/8 in the World Banks’ 2010 list but a variety of traditional and non-traditional middle powers including Canada, Australia, the MIST countries and even Argentina. This group of states is an expanded group from the older construct of self-identified middle powers. G20 membership has provided salience to this smaller segment than the diffuse cluster located by Goldman Sachs. .

Although the G20 Leaders Summit permanently established at the 2009 G20 Leaders Summit in Pittsburgh has been cast as a ‘concert of powers’, it is not similar to other concerts from previous eras. The simple fact is that the G20 is made up of 19 countries – along with the EU – and the number distinguishes the G20 from 19th or 20th century groupings made up of the 4 or 5 great powers. The G20 Leaders Summits – the new ‘High Table’ of global summitry provides middle powers with an excellent opportunity to act as policy insiders on key decisions. This ‘moment’ is reinforced by the unwillingness of the core BRIC states to embrace the role of active policy entrepreneurs within the G20. The big new rising powers – Brazil, China and India – have exhibited a willingness to work within these multilateral settings as a means of status-enhancement. It is still unclear to what extent they want to embrace the G20 as opposed to alternatives such as national self-insurance and/or alternative global/regional institutional options in where they have more autonomy (Barma, Naazneen, Ratner and Weber, 2007).

By way of contrast, select middle powers have grabbed the opportunity to take a leadership role within the G20. Even leaving aside a full discussion of how Canada attempted to re-calibrate itself once again as a middle power via the Toronto/Muskoka summits, it must be appreciated that traditional or non-traditional middle powers have hosted the G20 in 2010 (Republic of Korea) or will host it in 2012 (Mexico), 2014 (Australia), 2015 (Turkey) and possibly Indonesia (2016).

Furthermore, all of the countries are heavily invested in the G20 as a ticket to ‘great power status and influence at the High Table of summitry. Such an investment is crucial given the fact that a number of the G7 countries in the G20 remain ambivalent about the expanded institution, preferring at times to caucus in a smaller and far more familiar setting.

Amid these signs of ambivalence, however, attitudes have not hardened into a form of ‘blocism’. On an issue-by-issue basis G7 and BRICS countries both cooperate and compete. Brazil, China, and South Africa along with Canada, Japan and Mexico opposed the French, German and US proposal for a banking levy which aimed at making banks contribute to a rescue fund for bail-outs in future crises. Germany, the EU Commission and Brazil aligned in their criticism of US and Chinese exchange rate and monetary policy. China, Japan and Germany put themselves put in the same camp against the US criticism of ‘global imbalances’ and vigorously opposed US demands for political intervention against trade surpluses. These examples demonstrate that while the G7/BRICS responses have to be taken seriously, there is still room for alternative forms of leadership in the G20. In fact, as Jongryn Mo and I have argued in a Working Paper (Cooper and Mo, 2011) the emergence of crosscutting cleavages among G20 member states may promote more cooperation among member states and give more opportunities for political entrepreneurship by middle powers.

In democratic theory, a diversity of interests among interest groups is believed to promote inter-group negotiation and compromise across issues and thus, the stability of democratic governance. If this dynamics holds at the G20, the G7 and the BRICS will not always clash with each other and depending on the issue, they will cooperate based on shared interests. In this structural world middle powers will be able to play a very constructive role.

The dominance of the G7 and the BRICS at the G20 may even provide impetus for middle powers to cooperate even further. If the G7 and the BRICS continue to dominate or increase their influence at the G20, middle powers will have little choice but to strengthen their cooperation to forestall their marginalization. As noted the middle power’s incentive to remain relevant at the G20 is strong because the G20 is the only international forum of any consequence where the middle power countries can engage G8 and BRICS countries on an equal footing. To be sure, any coherent mobilization of entrepreneurial and technical capacity by middle states is not guaranteed however.

Still, up to the present moment, middle powers deserve credit for building momentum in the G20. The Republic of Korea and Australia worked especially hard after the London Summit to institutionalize the G20. Both countries felt that their efforts paid off when G20 leaders in Pittsburgh decided to designate the G20 as the premier annual forum for our international economic cooperation. One other highlight of their joint action was a joint op-ed column from the leaders, Lee Myong-bak of Korea and Kevin Rudd of Australia, to the Financial Times urging the G20 leaders to agree on a framework for macroeconomic policy coordination in Pittsburgh (the Financial Times, September 2, 2009).

The renewed use of this tactic is demonstrated by the letter written in September 2011 by leaders of a number of middle powers including Canada, Australia, Indonesia, the Republic of Korea, and Mexico as well as David Cameron of the UK. The core theme of this letter was that:

The G20 showed at the height of the global financial crisis that we could work together to deal with global instability – the Cannes Summit is an opportunity for leaders to prove this, arrest the slide in confidence, and strengthen the foundations for strong, sustainable, and balanced global growth for the future.

The willingness of middle powers to take on the in-between role distinct from the US, the Continental EU countries, and the BRICS is important for reflecting the fluidity of both interests and identity with respect to the G20.

Creative diplomacy goes hand in hand with reputation. None of the middle powers have been among the backsliders on the issue of capital and liquidity requirements since the 2008 crisis, in part because of default (the deficiency of financial institutions from middle states in the global systemically important or ‘too big to fail’ category) but also by design as illustrated by the solid fabric of this group’s banking regulations. Canada, Australia, South Africa and Mexico have all stood out for having regulatory systems in the banking sector that held up successfully through the financial crisis, with little or no impaired assets. From 1999 Indonesia embarked on a robust reform process in the banking system with wide-scale restructuring and closures combined with a recapitalization process. Korea launched an impressive Bank Recapitalization Fund together with the purchase of bank-impaired assets through a Restructuring Fund. Turkey and Argentina, although scarred by earlier crises, retain an importance in terms for lesson-learned vis-a-vis financial regulation.

Just when the middle powers seemed to have been written off as an increasingly marginalized group of member states, middle power activism has reinvigorated their diplomatic presence in global summitry. In an instrumental albeit uneven fashion select middle powers have gained leverage via their membership in the G20 Leaders Summit to compensate for their structural marginalization. The report of middle power demise in global summitry is greatly exaggerated!

 

Sources

Andrew F. Cooper, Richard Higgott, Kim Richard Nossal, eds. Relocating Middle Powers: Australia and Canada in a Changing World Order (Vancouver: University of British Columbia Press/University of Melbourne Press, 1993).

Andrew F. Cooper and Jongryn Mo, HGCY WORKING PAPER SERIES

“Middle Power Leadership and the Evolution of the G20”,

HGCY Working Paper No. 11-02, August 2011

Naazneen Barma, Ely Ratner and Steven Weber, “A World Without the West”, The National Interest 90 July/August 2007, 23-30

Goldman Sachs, “The N11: More than an acronym”, New York: 2007.

Fareed Zakaria, The Post-American World: and the Rise of the Rest (New York, Penguin Books, 2008).

 
 

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