Maybe they chose Ruhrgas's headquarters for a reason. This is where Russian gas workers and their partners once made their strategic plans, laying the routes for the blue fuel to travel to European capitals.
During its G8 Presidency in 2006, Russia initiated the discussion of energy security. Now Germany has inherited both the rotating presidency and this subject. But debates on this key issue in EU-Russian relations have never been easy. Europe, the consumer, and Russia, the supplier, have declared their intention to cooperate and their desire to diversify: Europe wants to receive hydrocarbons from different sources, and Russia wants to export them to different countries.
Without bowing to diplomatic formalities, some experts said on the eve of the Essen meeting that the G7 finance ministers wanted to prevent, or at least quickly respond to, fiscal crises. They emphasized that the world currency system rests on three pillars: euro, dollar, and yen, but by no means ruble.
Indeed, rubles do not yet weigh as much as these three currencies, nor even as much as the yuan. But it would be wrong to say that nothing depends on Russia in the world economy, and, specifically, on its finances. Russian Finance Minister Alexei Kudrin said before the conference that considering Russia's economic achievements, "we finance ministers could already meet as the G8." For the first time, he pointed out that the reasons why Russia is not yet a fully-fledged member of the club are probably political.
However, maybe the explanation is not so much political reasons as habit. The G7 nations are not used to considering Russia their equal in the elite economic club. But it seems they are already aware of the need to get into this habit. In Essen, German Finance Minister Peer Steinbrueck actually agreed with his Russian colleague. He said that Russia's improved economic situation was an argument in favor of granting it full membership in the financial G8. Moreover, in recent years, Russia has become a net creditor, which makes it a major global player.
Alexei Kudrin noted that in addition to its Stabilization Fund, Russia had accumulated more than $300 billion, and China over $1 trillion. The United Arab Emirates (UAE) is also stockpiling more money. Experts have been talking about the need to diversify and reduce the dollar's share in currency baskets. Some are even more radical; they want the dollar dropped from oil transactions and arms exports, and insist on handling accounts in domestic currencies (for instance, on a ruble-yuan or ruble-yen exchange).
These demands may become reality any minute since the ruble has become fully convertible and received access to the world market, and is accepted by foreign banks. Kudrin emphasized, however, that it is too early to present the ruble as a world reserve currency, because it will take at least a half century for it to become one.
Moscow is ready to wait for full membership in the elite club and is happy to take part in all G7 meetings at the invitation of the German finance minister.
Meanwhile, Russia's influence in the G8 is beyond any doubt. The organization, in fact, may radically change in the near future at Moscow's initiative. During Russia's presidency, the G8 started inviting key economic and political players, such as India, China, South Africa, Mexico, and Brazil, to its meetings. It is quite possible that this beneficial Russia-initiated tradition will give China, and other growing economies, the status of participant in all G8+ forums.
In Essen, Russia took part in practically all debates, while Alexei Kudrin made the main report on combating the funding of terrorism and money laundering, the main mission of the Financial Action Task Force on Money Laundering (FATF). The final communique supported his proposal to expand the FATF's mandate to include measures to prevent the funding of weapons of mass destruction proliferation.
In addition, Russia expressed its position on the Doha round of WTO talks. As a country on the verge of WTO entry, Russia is affected by anything that might upset those talks. Poor countries insist on lifting restrictions on trade in agricultural products. They also demand a cut in U.S. and European subsidies to agricultural producers, which do not leave developing nations a chance to sell their goods. Russia is in favor of these subsidies and will have to take sides.
Russia is also ready to take part in reforming the IMF, which has largely lost its role as a global creditor, and is prepared to become a global investor. Needless to say, Russia is happy to concentrate on what was in the spotlight during its presidency: improving professional education, particularly eliminating financial illiteracy; helping the poorest countries; and combating infectious diseases.
The opinions expressed in this article are those of the author and may not necessarily represent the opinions of the editorial board
