Trade

As leaders from the world's most powerful nations prepare to gather in St. Petersburg, Russia, this weekend, observers with even a modicum of memory could be forgiven for wondering whether the leaders suffer from Attention Deficit Disorder (ADD). After all, it was only one year ago that G-8 leaders met in Gleneagles, Scotland, and--against the background of a massive popular anti-poverty campaign--agreed to do more to reduce global poverty. CGD senior program associate Owen Barder read the flurry of reports assessing whether the G-8 leaders had followed through on their pledges and offered his own thoughtful summary scorecard. Bottom line: Trade: Progress has been disappointing with the near collapse of the Doha Round trade talks that were supposed to address inequities in the global trading system. CGD research fellow Kimberly Elliott has criticized a "lack of leadership" at the trade talks in Geneva. A strong statement on the need for a successful conclusion to the round by the G-8 leaders in St. Petersburg could help reinvigorate the talks. But Russia isn't even a member of the World Trade Organization (WTO), and had been hoping to use the G-8 meeting to push its bid for membership. In a situation like that, and with none of the big emerging market countries included in the G-8, it's hard to imagine serious attention to developing country trade concerns. Debt: "Promises have been kept and debt relief is making a difference, though this is of little importance overall," Barder writes. "The multilateral debt relief initiative will cancel debts of forty of the poorest countries owed to the IMF, World Bank and African Development Bank. Nigeria has had the largest debt relief deal in history--thanks in part to supportive CGD analysis. "But debt relief is relatively small beer in financial terms--this whole initiative works out about the same as a 1 percent increase in total aid spending," Barder writes. Aid: On increases in aid, and improvements in aid quality, Barder notes that little of substance was promised in Gleneagles, and less has been delivered. He's right, but it’s hard to square that with the high-sounding rhetoric and the high expectations of last year's summit. One area where the G-8 could still snatch a victory for development from the jaws of defeat is to follow through on plans to make an advance market commitment for a vaccine to protect people from one of several diseases that annually kill millions of people in the developing word. By making such a commitment, rich countries and other donors could create an incentive for private companies to invest in research and development, thereby speeding the delivery of an effective vaccine. As Barder notes in a separate post on The G-8 and Advance Market Commitments the official communiqué issued by the G-8 finance ministers after their meeting in April said: "Having endorsed the concept of a pilot Advance Market Commitments for vaccines, we call for the additional work necessary to make its launch possible in 2006." Supporters of the idea are hoping that G-8 leaders will name a specific disease and commit a specific amount of money to purchase vaccines, when and if they become available. Among the possible targets for such a commitment: TB, HIV, malaria, and pneumococcal diseases, primarily pneumonia and meningitis, which alone kill an estimated one million children a year. There is widespread support for the idea, which draws on the report of a CGD working group, Making Markets for Vaccines: Ideas to Action.  A joint op-ed by former senior officials to ex-presidents Clinton and Bush appeared recently in the San Francisco Chronicle, and was picked up Boing Boing, a leading blog. Meanwhile, the Financial Times ran a joint article by the president and CEO of BIO Ventures for Global Health, and the director-general of the International Federation of Pharmaceutical Manufacturers and Associations, urging governments to proceed with the plan. A favorable July 2006 article in Scientific American traced the origin of the idea to work by Harvard professor and CGD non-resident fellow Michael Kremer. Given the combination of a technical consensus on the merits of the idea and broad support from key stakeholders--including from their own finance ministers--will the G-8 leaders meeting in St. Petersburg finally move forward with an advance market commitment for vaccines? Do they even remember that in Gleneagles they asked their finance ministers to investigate and come back with a solid proposal? Signs are not very encouraging. Barder cites a Reuters report that progress has been tied up by political horse-trading and domestic funding questions. Of course, these are the sorts of problems that global summits were designed to overcome. It is just possible that the G-8 leaders will do the right thing. Here's hoping.