The Group of 7: a Global Board of Directors

July 14, 1991|By RICHARD O'MARA | RICHARD O'MARA,The Sun's London Correspondent

LONDON. — London -- The Group of Seven economic powers opens its 17th annual summit meeting here tomorrow: Principal among its purposes will be to guide and encourage much of the world out of its recession and to hear an appeal by Mikhail Gorbachev for assistance in making his country more like theirs.

It will be George Bush's third appearance at a G-7 summit, th first one hosted by John Major as Britain's prime minister. It will be Germany's first as a united nation. It will also be the first one in a decade without the immense presence of Margaret Thatcher. For that reason, it is expected to be a more tranquil affair. Mrs. Thatcher's departure returns the G-7 club to an all-male status. Mr. Gorbachev will not arrive here until Tuesday night. His presence will, in effect, produce a second summit, between him and the seven leaders.

What is the Group of Seven? What its members going to b doing here for much of this week?

The Group of Seven is an informal club of the world's riches democracies, kind of a self-appointed global board of directors, whose influence extends much farther through the world than its formal authority. The G-7 countries are the United States, Canada, Japan, Britain, France, Germany and Italy. They are at the headspring of economic power in the world: they hold the greatest concentration of wealth and deploy the major forces of production.

The leaders of these countries will meet here tomorrow. They wil consider much more than the Soviet Union's appeal for economic assistance, though that is the topic that has captured the media's attention.

The G-7 has no bylaws, no firm rules or fixed patterns. Th leaders of member countries meet once a year to discuss the major economic issues of the day. The European Community is represented at the summit table by the presidents of the Commission and Council. It is, then, a summit of nine.

But when they are finished talking, they cannot tell the Unite Nations what to do, or the World Bank whom to lend money to or the International Monetary Fund whom to admit as a member. They cannot require the new European Bank for Reconstruction and Development -- which was fostered by some member countries -- to lend billions of dollars to, say, the Soviet Union, or demand that it withhold such aid.

But all these organizations frequently take their cues from th G-7 -- not only because the G-7 countries are the main sources of their funding, but because their communiques usually -- though not always -- represent an olympian consensus.

Sometimes there is disarray on Olympus, and policy signals ar sent out unclear. The current meeting from tomorrow through Wednesday is likely to yield much agreement on major issues, and some dissension.

Areas likely to produce accord are on immediate Marshall Pla type aid to the Soviet Union, which members will oppose, and the control of arms sales, especially to the Middle East, which they will likely endorse.

The leaders will hear Mikhail Gorbachev's plans for the economi restructuring of his country; they will probably agree to large amounts of technical assistance, possibly food aid. But it will be money in the millions, not in the billions.

The Soviet Union is expected to win associate membership i the IMF, which means it will be in the club but not able to avail itself of its funds. That will come later.

It is not a major surprise that Mr. Gorbachev will be in Londo simultaneously with the G-7 leaders. He has been trying to associate his country with the club for several years. It is a major tactic in his overall strategy to move the Soviet Union into the mainstream of the world economy.

Disagreement at the summit will probably revolve around th issues of interest rates, debt relief for the poorest countries, the environment and possibly trade. Other issues sure to come up are the U.S. lifting of economic sanctions against South Africa and how to cope with the after-effects of the Persian Gulf war.

On the first of these, the U.S. has been trying to encourag Germany -- which is the ''growth locomotive'' of Europe -- to lower its interest rates and take other decisions to expand its economy in an effort to pull the more sluggish countries in Europe out of recession. This encouragement is likely to continue over the next few days, but without much success.

The environment, as the summit approaches, is being touted a the sleeper issue, one that will draw more attention than anyone had anticipated. ''Everybody's green these days,'' said a a diplomat, which suggests the likelihood that a consensus on global environmental policies might be reached in London.

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