This paper explores the role Spain can and should play in the
institutions engaged in global governance in the current context of
financial crisis and reconfiguration of international power centres.
After briefly analysing Spain’s relative position in the world
–on the basis of economic and other criteria– the study
suggests the path it should follow to boost its influence in the
world. The paper points out Spain’s comparative advantages, the
areas where it could contribute most, and the shortcomings that make
it difficult to translate Spain’s economic weight into greater
political influence at the global level.
(1) A preliminary matter: can Spain really play in the big leagues?
For some time now, a debate has been under way concerning Spain’s
international influence: while some analysts argue that in the past
15 to 20 years the country has punched above its weight, taking
advantage of a favourable environment without addressing certain
structural issues (for example, the size and funding of its Foreign
Service and Armed Forces), others claim that Spain wields less
international influence than it is entitled to, given its current
level of economic, political and social development.
The doubts raised before it was confirmed that Spain would be present
at the enlarged meetings of the G-20 in Washington (November 2008)
and London (April 2009) have stirred a new and interesting debate on
Spain’s international role, and in particular its possible
contribution to a redefinition of the institutions of global
governance. The debate has been positive in so far as it has revealed
that Spain’s political elite and significant sectors of society
are sensitive to the need to avoid being complacent abroad. However,
it has also given cause for concern by revealing that there is
considerable uncertainty as to how globalization can best be
governed, and a lack of clear thinking as to why Spain should seek to
play a prominent role in the future world order. Doubts have also
been raised as to Spain’s ability to take on the responsibility
that such a role entails.
One initial question to resolve in all this requires coming up with
an accurate estimate (neither complacent and self-aggrandizing nor
self-deprecating and unduly modest) of Spain’s potential. This
calls for rigorous analyses comparing Spain’s international
status with that of other countries while taking into account
historical trends and prospects for the future. As far as Spain’s
international economic weight is concerned, objective empirical data
indicate that its economic position is the following:
Spain has the world’s eighth-largest economy, with a GDP of
just over 1 trillion euros, behind the US, Japan, China, Germany, the UK, France and Italy.
If the size of its output is measured in Purchasing Power Parity
rather than at market exchange rates, it drops to 11th place, falling behind India, Russia and Brazil (these three emerging
countries have populations much larger than Spain’s and per capita incomes far below Spain’s).
If one divides the size of the economy by the population (thus
obtaining per capita GDP), then Spain surpasses €24,000
per capita (around US$30,000). This brings it down to 25th in the world, measured either at market exchange rates or purchasing
power parity. However, if one only considers countries with more
than 10 million inhabitants, Spain rises to 11th place,
and is surpassed only by the traditional powers of the G-7 (at a
level similar to Italy’s), plus the Netherlands, Australia and Belgium.
Spain accounts for 2.5% of world GDP and 2.7% of world trade
(imports plus exports). However, Spain’s quota at the IMF is
not commensurate with that weight and is a mere 1.69%. There is a similar situation within the World Bank Group, and at the
International Bank for Reconstruction and Development, for instance,
Spain’s contribution and voting weight only adds up to 1.7%.
In both cases, these quotas, which are far below Spain’s real
weight, place it 15th in the world, ranking behind
countries with smaller GDPs such as Belgium, the Netherlands, Canada, Brazil, Russia, India and Saudi Arabia.
At the European level, Spain is firmly established as the fifth
largest economy in the EU, with a per capita income of €24,000 a year, which places it close to the EU-27 average.
Among exporting countries, Spain is 15th in the world,
behind much smaller countries (such as the Netherlands, Belgium and
Singapore). Its current account balance is particularly
deficit-prone within the developed world, as a result of which it
has a structural need for external financing. In 2008, its current
account deficit reached 10% of GDP (some €120,000 million), the
second largest deficit in the world after the US (and the largest in
relative terms among advanced countries).
Despite the vulnerability resulting from this structurally negative
trade balance (and which is offset less and less by a surplus in
services), Spain performs well in some industrial areas: for
instance, it is the world’s eighth largest car manufacturer
(although in decline because of relocation to Eastern Europe), and
its renewable energy, biotechnology and telecommunications sectors are very strong.
In the energy field, Spain is clearly dependent on the outside
world, in spite of which it is the 12th largest nuclear
energy producer, and also the fourth largest producer of renewable
energies, after Germany, the US and China. One little known fact is
that in recent years many re-gasification plans have been built, as
a result of which two-thirds of the natural gas imported by Spain
imports is liquefied (and thus not transported through gas
pipelines, which are more prone to cuts in supply). This makes
Spain, along with Japan and South Korea, one of the worlds’s most advanced countries in this respect.
Spain is in better shape financially than commercially: it is the
world’s sixth largest overseas investor in terms of stock, and
in 2007 it ranked third in terms of the amount it invested in other
countries, mainly in Latin America and the European Union. Two
Spanish banks (BBVA and Santander) are among the ten largest in the
western world, the Madrid Stock Market is among the top ten in the
world in terms of capitalization and operations, and the market’s
value is even greater if one includes LATIBEX which combines Spain with Latin America.
Spain, furthermore, is surpassed only by France in the number of tourists it receives each year.
According to the Economic Freedom Index compiled by the Wall Street Journal and the Heritage
Foundation, Spain is in 29th place; and it is ranked 27th in the Global
Competitiveness Index published by the World Economic Forum.
Finally, Spain is ranked 12th in the Brand-Country Index published
by Future Brand and Weber Shandwick. It mainly stands out as an appealing place for travel and family life.
Leaving aside its economic importance, one should also keep in mind
Spain’s position in rankings that measure other aspects
(political and social) which also have a direct impact on the country’s level of influence in the world:
In the UNDP’s Human Development Index, Spain tends to
rank 13th to 16th in the world. This index is
a good indicator of quality of life because it combines per capita income with life expectancy.
In the Prosperity Index published by the Legatum Institute,
which also combines economic with socio-political factors, Spain
ranks 20th (significantly, it ranks 26th in
economic competitiveness and 18th in well-being, being
particularly strong in leisure activities, health, personal freedom, family and internal governance.
The rise in Spain’s commitment to development in recent years
knows no equal: in 2007 Spain earmarked 0.41% of GDP for official
aid (more than €4,200 million), making Spain the world’s
seventh largest donor in absolute terms, and in 2008 it will have
reached the 0.5% threshold. Furthermore, Spain ranks 12th in the commitment to development aid index published by the Center
for Global Development in Washington. It is ranked third among countries which have advanced the most over the last two years.
In recent years Spain has also increased its overall commitment to
the United Nations, and is now it ninth largest contributor in terms of quotas.
However, Spain drops down to 27th place in the Corruption Perceptions Index published by Transparency International.
There are also problems in the field of education: although state
spending has increased significantly in the past three decades (and
represents 4.8% of GDP), it is still below the OECD average (5.5%).
This translates into a poor level of education at the mandatory
level (Spain is in the 25-30 range among the 60 countries that took
part in the PISA Report). The results are similar for Spanish
universities: Spain invests 1% of its GDP in higher-level education
(compared to an OECD average of 1.3%), but very few Spanish
universities and research centres achieve high levels of excellence in international rankings.
In terms of scientific research and technological development, the
data are particularly negative. Although some progress has been made
in recent years, Spain only invests 1.2% of GDP in R+D. This is
seven-tenths of a percentage point below the EU average and less
than half of what countries like the US or Japan spend. Furthermore,
when it comes to registering patents in the EU-15, Spain is at 25%
of the EU-15 average. All of this means low levels of productivity,
little added-value being incorporated to export products and limited
technological innovation outside of large multinational companies.
Culture-related rankings are much more positive, particularly with
regard to the literary world (including book publishing), the Arts
(Spain is ranked second in the world in terms of UNESCO World
Heritage Sites and major museums), sports, cuisine and even cinema.
And above all (although this factor is shared with 18 other
countries), the international importance of the Spanish language is
beyond doubt: some 450 million users make it the world’s
fourth most spoken in the world, the third most widely used on the
Internet and the second most frequently studied as a foreign language, surpassed only by English.
Finally, in the category of total spending on defence, Spain ranks
15th in the world, behind countries of lesser economic
weight, such as South Korea, Saudi Arabia and Turkey.
In short, whereas Spain is 12th to 30th in the
rankings that measure values related to wealth, quality of life and
economic or political freedom (which is quite respectable,
considering that there are currently almost 200 sovereign states in
the world and, in particular, only 10 countries surpass Spain if we
restrict the rankings to countries with more than 10 million
inhabitants), in the indicators that measure socio-economic power
around the world in absolute terms, Spain ranks even higher, between 6th and 15th place.
In light of all of the above, today Spain may be said to be among
the 10-12 most important countries in the world.
For well-known historical reasons, Spain was not able to participate
in the creation of the institutions and procedures that have defined
global governance since World War II. Consequently, if we are really
moving toward an ambitious reshaping of those institutions and
procedures, we must seek to prevent Spain from being excluded again
and consolidate a presence that it began to forge by taking part in
the G-20 summits in Washington and London as well as by joining of the Financial Stability Forum.
What is more, from our point of view Spain must find a way to make
virtue out of necessity, using the current financial and economic
crisis in order to strengthen its position among the world’s
most influential countries. It is not a matter of Spain’s
taking part in the most important forums as a way of gaining prestige
or enhancing its reputation. Rather, it is because these forums will
play a key role in reconfiguring the international order, an order
which will largely determine Spain’s future well-being and security.
(2) What model should Spain follow in order to be a major player?
Before suggesting a strategy for achieving this goal, it is essential
to have a clear idea of which model one wishes to pursue. More specifically, Spain must decide if it wants to be:
A country with growing ambitions abroad and which, like some other
intermediate or emerging players, seeks to enter the group of
leading actors which shape world policy by relying not so much on
its political, social or cultural assets, or on the fact that it
embodies values that are shared all over the world, but rather on
classical elements of so-called ‘hard’ power. These
elements include economic weight, demographic size, the expansion of
its companies and even the potential for physical coercion or, at
least, the capacity to befriend or form alliances with nations that
do enjoy undisputed military capability.
A ‘Scandinavian-style’ state, characterized mainly by
its ‘soft’ power’ and admired abroad for its
respect for democracy and human rights, or its commitment to
protecting the environment, sustainable development, etc. Or even a
State which could come to be considered neutral by the non-western
world because it knows how to eschew permanent alignments and thus
has enough credibility to understand sensitivities that are not
inherent to the Euro-Atlantic world, denounce situations that are
unfair, and, to the extent that the resources earmarked for its
Armed Forces will allow it, take part in peacekeeping operations,
A ‘medium-sized’ power of regional scope but global
projection, which, besides promoting certain values and principles
that are widely shared by its population (democracy, personal
freedoms and liberties; respect for international law, sustainable
economic growth, the war on poverty, etc.), which grant it the
legitimacy to lead global initiatives or mediate in conflicts, has
substantial interests to defend overseas (security-related,
economic, energy-related, cultural, etc.). It will seek to do so
through ambitious diplomatic action of its own, which will
nevertheless be in keeping with the notion of ‘efficient
multilateralism’, acting at three distinct levels: first and
foremost, the European; secondly, the Western, and finally, at the
As we see it, Spain should clearly opt for the third model, which is
also the one embraced by Germany, France, the UK, Italy and the
Netherlands or, beyond the borders of Europe, by Japan, Canada and
Australia. This is because Spain is particularly well-placed to
combine the ‘hard’ power it has accumulated over the past
few decades with growing ´soft´ power which increasingly
takes into account both the appeal of its recent successful history
in terms of development and co-existence and its potential in matters
cultural, linguistic, scientific and sports-related, amongst others.
Opting for this third model is not only desirable in and of itself.
It is consistent with Spain’s major contemporary options in
foreign policy and with the conviction that diplomacy should serve to
promote Spain’s specific national interests and its
highly-regarded overall political and socio-economic model.
Furthermore, it is also a necessity, for if Spain does not opt for a
model that aims to maximize its influence in international relations
–by using the various elements of power that are at its
disposal, and in the appropriate combinations– it will
gradually lose influence overseas. This will mean fewer opportunities
for shaping globalization in line with the country’s priorities
and comparative advantages (economic and institutional), and could
eventually undermine Spain’s own prosperity by limiting its
room for manoeuvre as a sovereign political entity.
(3) We want to be among the big players, but where, exactly?
The drive to be among the group of countries that aim to lead the
process of globalisation raises two questions about the strategy that
Spain should pursue to achieve this objective:
Firstly, in terms of European integration, how loyal is it for Spain
to seek to act on its own without entrusting the defence of its
interests exclusively to the EU, which is currently an informal
member of the G-8 and a full-blown member of the G-20?
Secondly, it has been taken for granted that the G-20 is the forum
in which Spain should try to consolidate its position, without
taking into account that many prominent voices express serious
doubts as to whether this is legitimate and/or appropriate.
As far as the first question is concerned, it could be argued that a
specifically national strategy to shape globalization and world
governance is incompatible with Spain’s European calling.
However, Spain, whose GDP doubles that of the sixth EU member state
(the Netherlands) and is three times that of the seventh (Poland),
has already reached the average wealth of the EU-27 (and will very
soon cease to be a net recipient of EU funds as a result) and has the
highest net influx of immigrants in the EU, can legitimately seek to
play a more prominent international role. As the EU continues to
enlarge and comes closer to having 30 members, only six or seven of
which have demographic or economic weight that is truly meaningful,
the importance (and responsibility) of the larger states must
Furthermore, the way we see it, European integration is a
positive-sum game, not a zero-sum game. Insomuch as Spain is a
country with solid Europeanist convictions, a greater Spanish role at
the global level can only benefit the EU as a whole. Europe is, of
course, more than the mere sum of its parts. But its relevance also
rests on the importance of those parts. A Spain which seeks to make
its own, individual contribution to governing globalization enhances
the European component of that undertaking. If the Union later rises
to the task, finally gets beyond the endless debate over its
institutional model and agrees internally to assert itself abroad as
a cogent entity –which is what Spain wants– the capacity
acquired individually by Spain will certainly serve the EU bloc as a
whole. But if such a European development does materialise, Spain
will not have wasted its efforts, either.
What is more, although Spain sees itself as the fifth-largest power
in the EU in economic and political terms, it has some specific
features (its influence in the Maghreb and Latin America and the
importance of its language and culture) which make it a regional
player with a global projection. One must not forget that,
paradoxically, even though Spanish is the second language
internationally, it is only fifth in the European realm.
Having established the argument that it is legitimate for Spain to
think and act of its own accord in parallel with the EU (though not
independently of the EU), it is now time to consider the
appropriateness and legitimacy of the G-20 as the forum in which
Spain should seek to consolidate its presence in order to achieve the
goals mentioned earlier.
Whether Spain likes it or not, in the past few decades the larger
states have increasingly used the ‘G’ format for
meetings, from which Spain had been absent until now. These informal
gatherings for international economic governance, whose members tend
to meet several times a year at the ministerial level, and with a
higher political profile at summits (usually yearly) of heads of
State or Government, have no founding charter or permanent
administrative structure, nor any official link to the United Nations
system or other international organizations open to all states
because, unlike these organizations, membership in the G formats is
acquired through cooptation.
The idea first emerged in the mid 1970s as a German and French
initiative, when these countries invited the other leading
industrialised powers (the US, the UK and Italy) to an informal
meeting of heads of State and Government to discuss how to respond to
another international economic crisis (that of 1973, and the world
recession that followed it) and the ending of the Bretton Woods
system of fixed exchange rates. Thus, the G-6 was born. Only two
years later the name was changed to G-7 with the addition of Canada
-which at the time was much richer than Spain –and in the 1990s
the group grew to incorporate Russia (G-8) and the EU. The EU participates in meetings through the European
Commission and whichever country holds the Union’s rotating
presidency, although it does not have the same status within the G-8
as the other member states.
Although the G-7/G-8 has always lacked any real legal or political
international legitimacy, its relative efficiency in advancing some
economic coordination measures amongst its members (such as the
reactivation plan produced by the Bonn summit of 1978) and the
enormous differences between the GDPs of the West and the
less-developed world explain how it perpetuated itself. However, as
of 1995 there was increasingly vocal criticism of the sharp
differences between the Northern and Southern hemispheres, and of the
trade, agricultural, environmental and foreign debt policies of the
wealthy countries represented in the G-8, which duly reacted by:
Broadening its agenda from strictly economic, financial and trade
issues to other areas that were more political, such as domestic
security, development aid, energy and the fight against global
Inviting organisations that belong to the United Nations system to
participate in G-8 meetings. This began in 1996 and involved
organisations like the IMF, World Bank, WTO (trade), WHO (health),
IAEA (nuclear energy), UNESCO (education, science and culture) and
the UN itself. From time to time regional organizations like the
OECD or the Commonwealth of Independent States have also
Above all, by examining its limitations in continuing to govern an
increasingly globalised world economy in terms of legitimacy and
efficiency, to the point of studying the possibility of enlarging
its membership in order to take in the emerging economies.
Over the past four years, five countries (Brazil, China, India,
Mexico and South Africa) have been invited regularly to these
summits. In this way, and mainly with the backing of the European
members of the club, the idea of the G-8 + 5 emerged, which has been
more or less formalised since 2005, and even that of a possible G-14
(which would subsume the G-8 and include Egypt to represent the Arab
world). However, this format has not been very satisfying, both
because of the limited attention paid to non-members –be they
individual countries or international organisations– and the
presence of non-permanent guests. For this reason, and in response to
the Asian financial crisis of 1997, the G-20 emerged in 1999. It was
formed by the old G-8 and the EU (which became a full-blown member),
plus Australia and 10 other countries that were considered to have
emerging economies and were reasonably representative of all the
world’s continents: China, India, Brazil, Mexico, South Korea,
Turkey, Indonesia, Saudi Arabia, South Africa and Argentina.
The fact that the G-20 represents more than two-thirds of the world’s
population (compared with 15% in the case of the G-8) and also a
significantly larger proportion of world GDP (nearly 90%, compared
with 65%) and world trade (almost 80%) and even the planet’s
surface area (more than 60%), has boosted its credibility.
Furthermore, the presence of 20 members makes it plausible for there
to be a process of give-and-take and reasonable decision-making in
it. This enhances the idea of the G-20 being a less-than-perfect but
acceptable alternative to the elitist G-8 or the apparently
ungovernable United Nations system.
Having said this, Spain’s position in relation to the G-20 as
the ideal forum is far from comfortable. Despite its success in
managing to be invited to the Washington and London summits, Spain is
still not a formal member of the group, although in the first half of
2010 its presence is guaranteed because it will hold the rotating EU
presidency and this could pave the way for it to be incorporated
permanently. At the same time, although Spain was not initially a
member of the Financial Stability Forum either, the diplomatic
efforts made in recent months have allowed it to join that forum. The
final statement issued after the G-20 meeting in Washington
underlined that this organisation will play a key role in reforming
the regulatory system overseeing international finances.
Therefore, and in order to avoid counterproductive naiveté
(after all, Spain is still not a permanent member of the G-20) and
inconsistencies (in contrast to the multilateralist and open
discourse maintained so far), it would be a good idea for Spain to
incorporate into its strategy the explicit question of the legitimacy
of the G-20 when it comes to future reforms of the system of global
governance. That said, since it would be contradictory to challenge
the legitimacy of an organisation that one wants to join as a
permanent member, one possible interim strategy might be to accept
the G-20 as a launching pad that might be enhanced in three ways: (1)
increasing the number of members to 24; (2) including the presence of
three global-level international economic organisations, linked in
one way or another to the United Nations system; and (3) allowing the
presence of large areas of the world that are now vastly
under-represented, through the incorporation of three additional
Firstly, increasing the number of seats to 24, while
maintaining a manageable size for this forum, might resolve the
shortcoming that is not only the one that worries and harms Spain the
most –in other words, its own absence from the G-20– but
also one that has proved itself to be a clearly relevant issue.
Indeed, it is this shortcoming that forced organisers to enlarge the
two recent G-20 summits to include two countries which, even though
they are among the largest and most influential at the international
level (Spain, in 8th to 11th place and the
Netherlands, in 16th to 19th place), were not
part of a forum whose very name suggests it should comprise the
world’s 20 most important countries. This structural anomaly in
the G-20 stems from its founding goal, which was to respond to the
financial crisis of the 1990s. That crisis mainly hit the economies
of Asia and Latin America, not Europe, so no country of the EU that
was not already part of the G-8 joined the G-20 from the outset.
Inasmuch as the G-20 is now asserting itself as the proper forum for
addressing the current crisis or refashioning the world economic
order –issues that do affect Europe directly– it is
necessary to modify its make-up by adding Spain and possibly the
Netherlands, and it is not a bad idea to consider bringing in Poland,
too. Now, in order to maintain a reasonable balance between developed
and emerging economies, one would have to enlarge the forum with an
equal number of developing countries. Iran and Thailand, and to a
lesser extent Pakistan or Egypt, might be candidates to complete the
A second step would be to expand the current membership to include
the presence of three international organisations of global scope and linked in one way or another to the United Nations system:
the IMF (including its committees specialised in the
monetary-financial and development realms), the World Bank and now
also the World Trade Organisation. In this way the G-20 would get a
fresh start with a greater economic projection than it had when it
was formed 10 years ago. The United Nations as such should probably
not join the G-20, both because it would be inappropriate for it be
part of a forum that is in theory subordinate to the United Nations
and simply because its current institutional structure would make
such a step impossible. However, as we will discuss later, one would
need to stress the need to link the G-20’s work with the
current social and economic institutions of the UN (or, even better,
with those that emerge from a possible reform). It might also be a
good idea to invite the UN Secretary General to future G-20 summits.
Finally, by adding three new seats, the G-20 could address
large areas of the world that are still under-represented. In this
way the forum would achieve a new overall legitimacy, and in
particular among some economies which, while important (Malaysia, the
Philippines, Singapore and Vietnam in Southeast Asia; Nigeria and
Algeria in Africa; and Colombia, Venezuela and Chile in South
America) are too small to have seats of their own because the goal is
to ensure that the G-20 retains a size which allows it to get things
done. The formula for handling these three new members could be one
of the following:
Through the presence of three regional economic and political blocs
that correspond to the three large areas we have mentioned above:
ASEAN, the African Union and UNASUR. The precedent established by
the EU’s being a full-blown member of the G-20 –even
though this is fully justified given the EU’s effective
jurisdiction over the economies of its 27 members and the relevance
of the member states that do not have their own seats– makes
it perfectly plausible to have these three other regionally-based
international organisations join the G-20.
Through a system of three rotating pro-tempore members chosen
under the classic UN system for filling elective posts in its
institutions; in this case they would be chosen from three
geo-political groupings, namely Asia-Pacific, Africa and Latin America-Caribbean.
Through a less orthodox approach using formulas that are not
regional but functional. One can argue that what really matters is
not so much representing continental diversity –in the end,
this is more or less achieved among the current members of the G-20–
but rather the plurality of interests in the supply and demand of
the various factors of production. In other words, the G-20 could
take in economies of secondary importance through groups of states
classified on the basis of whether they export or import energy,
capital, certain goods, manpower, etc (for instance, OPEC in the
case of oil, the Cairns group, which is the G-20 of developing
countries for farm products, the G-10, or so-called Paris Club of
creditor nations and its sister organisation for debtors, the G-24,
or another similar group that might be created in light of demographic factors that generate emigration, etc).
A proposal along these lines (G-24 + 3 + 3, or a G-30, if you will)
would maintain a workable size. Just think that only around five
seats would be added in comparison to the number of countries and
organisations that were present in Washington in November 2008 and
there would even be a reduction compared to those attending the
London meeting in April 2009. Such an arrangement would also be hard to criticise in terms of international legitimacy. Finally, a proposal of this type could tie
in with a project to reform the UN itself, with regard to which Spain
has so far behaved in a rather passive and reactive fashion. It would
connect the Group of 20 with whatever new institutional structure, at
least in the economic, social and environmental dimension (but
without renouncing a similar model on security issues) replaces or
improves the currently ineffective ECOSOC.
In view of Spain’s somewhat awkward position in the current
G-20, it seems it would behove the country to propose this kind of
debate. That said, regardless of the possibility of Spain making a formal proposal of the kind outlined here, or any other it might deem
better, Spain should insist on linking the discussions and
conclusions of the G-20, or any other group that might replace it,
with world-encompassing procedural rules that are acceptable to
everyone. This could be done either by having the G-20 (or G-20+)
powers agree their positions at the regional level with small states
(in the case of Europe it is evident that this role would be
performed by the EU), or by establishing a stable connection with the
United Nations system, linking this idea with the reform of the UN itself.
To sum up, having endorsed the EU and the UN so actively in its
overseas actions it would be good for Spain to be especially careful
with its public strategy towards the G-20. It might be that this
Spanish attempt to improve the G-20, without losing its essence as a
workable forum, ended up attracting no outside support. But in that
case Spain would have better grounds to call for a G-20 enlargement
of which it would be the sole beneficiary, as the lesser of two evils and without betraying its principles.
(4) Spain wants to be a major player, but what can it contribute?
As already mentioned, the decision to be among the world’s
major players is not mere fancy, but rather a way to consolidate the
position that Spain has occupied over the past few decades and avert
the loss of influence that would probably result from not acting at
all. It should be noted that, after having overtaken Canada
economically, Spain is never going to move beyond its current
absolute position (the world’s eighth-largest economy) and
emerging countries such as Brazil, Mexico, Russia and India will not
take long in overtaking Spain. For this very reason, Spain cannot
base its future global influence exclusively on its relative economic weight.
In light of its political, economic and social development since the
restoration of democracy in 1978, Spain should aspire to lead global initiatives that might benefit from:
Its model of transition from an authoritarian dictatorship to a
democratic state governed by the rule of law, all of this in tandem
with a significant process of territorial decentralisation, social
cohesion, etc. In light of this, it is striking that Spanish foreign
policy has not done much in terms of explicit support for processes
of democratisation, social dialogue and federalisation in other
parts of the world –in particular Latin America, eastern
Europe and the Mediterranean region– despite its recent authoritarian past.
The fact that Spain is a responsible state in macroeconomic terms
and an exemplary member of the euro zone. The process of nominal
convergence in the 1990s was outstanding, and Spain’s level of
public debt as a percentage of GDP is among the lowest in the EU.
This amounts to a significant exercise in collective responsibility.
Its commendable regulatory system for banks and finances, relying on
a model that is now considered exemplary. It is based on forcing
banks to set aside counter-cyclical provisions, barring
off-balance-sheet transactions and rigorous oversight by the Bank of Spain.
Its ability to create large multinational companies, generally as
the result of privatisation processes that have been economically
successful and accepted by society (especially in comparison with
those of other countries), many of which have made ‘green’
commitments or other pledges in favour of human rights in line with
the principles of Corporate Social Responsibility. Indeed the growth
of some Spanish companies and their international influence is
perhaps the most noteworthy phenomenon in the process of economic
opening that Spain has undergone, with leadership positions in
important sectors such as banking, energy, telecoms, construction
and public works, tourism, transport and retail sales outlets, among
others. Furthermore, although some Spanish multinationals have been
criticised abroad (mainly in some countries of Latin America, such
as Argentina and Bolivia), in general their public image is quite
positive. They have created major foundations and most of them are members of the UN’s Global Compact.
Its development of sources of renewable energy in the fight against
global warming often based on innovative public-private
partnerships, including the legal frameworks that make these
arrangements possible. In Spain, which has an energy dependency
–both on outside countries and on fossil fuels– that is
well above the OECD average, and where public opinion is not keen on
nuclear power, supporting renewable energy amounts to making a
virtue out of necessity. For now, cooperation between the state and
multinational energy companies (which is not always easy) is
allowing for major progress in an area that is particularly fertile
for scientific research and R+D, which is the weak point in Spain’s
development model. In institutional, legal and regulatory terms,
Spain’s model is being watched keenly from abroad (mainly by
the US, where each state has its own regulations, a system which
makes it hard to have a federal energy policy) and this offers an
opportunity to strengthen relations between the Spanish government and the new Obama Administration.
The growing strategic importance of Spain on account of its presence
in a kind of thematic crossroads (North-South, Western World-Islam,
Europe-America). At stake is much of the global strategic game, with
challenges such as managing migratory flows and cross-border
terrorism. What has emerged is a new situation in which Spain finds
itself at the centre of many issues. This offers numerous
opportunities, but also vulnerabilities. It forces Spain to take
very seriously the challenge of living with immigrants and
integrating them, as befits a frontier country which has taken in
more foreigners over the past decade than any other except the US.
A firm commitment to development aid, with a view to complying with
the goal of spending 0.7 % of GDP in this field. For several years
Spain has been striving to make its development aid policy more
consistent (as illustrated in the number of rungs it has climbed in
the Commitment to Development Index published by the CGD).
This progress has placed Spain among the donor countries with the
most advanced policies, increasingly in line with the Accra
Commitments on development aid. In particular, Spain is increasing
its level of Official Aid, has an immigration policy that is
relatively open, shows innovation in programs of debt forgiveness
and swapping, and refrains from exporting arms to countries that are
at war (however, it still has room to improve its trade and
technology-transfer policies and increase its aid to low-income
countries of Africa and Asia, although in recent years it has made
progress in this realm as well).
Other ‘soft’ power resources, in other words, the power
of attraction through its climate, landscape, language, culture,
tourism infrastructure, and artistic and other heritage. These
enhance Spain’s value as a meeting point and a bridge between
states, cultures and diverse religions.
In relation to the latter, when it comes to encouraging institutional
reforms that require broad international agreements, Spain boasts
some specific features that other Western countries often lack. Above
all, due to its status as a late-comer to the club of the most
developed countries, the long time that has elapsed since it was an
imperial power, and certain other cultural features, Spain is
particularly gifted in getting along with states and regions with
which ‘the West’ tends not to have fluid relations
(Russia, Iran, Turkey, parts of the Maghreb and Latin America). There
are very few EU or NATO member states which have the same comparative
advantages, and it is possible that the ‘Alliance of
Civilizations’ launched by Spain in 2004 has contributed to
develop this dimension further.
All of this means it is not just that Spain seeks a leading role in
the drive to guide globalisation. Rather, many of those who want
globalization to be guided demand, or would certainly expect, leading
roles for countries such as Spain. In short, what Spain can offer is
a consolidated democracy with a high level of human development, one
which shuns the idea of imposing its own values and ethnocentricity,
as well as anything-goes relativism of values and complacency with
regard to the imbalanced international economic and political order.
Taken together, all of this could make Spain a first-rate mediating power.
In light of what we have stated above, it is clear that Spain has
many valuable things to contribute to the new international
governance, beyond its economic weight as measured in terms of GDP.
And that wealth of facets must be applied to specific and substantial
solutions that Spain might suggest in response to the difficult
financial and economic situation we are now in. Spain should aspire
to contribute to resolving the crisis through proposals that are
innovative but realistic, ones that are part of a broader agenda
whose ultimate goal is to reform the tools and procedures of global governance.
In general terms, it seems evident that in order to resolve the
crisis we need to implement a new regulatory framework which, besides
guaranteeing the orderly functioning of capital flows, must also serve as a foundation for encouraging:
Greater global macro-economic stability;
International trade that is fairer and allows for the development of the poorest countries;
A more efficient battle against poverty, and one that takes into
account the food and water-access crises that are approaching;
A viable post-Kyoto system for reducing CO2 emissions and allowing
for environmental sustainability in general;
Truly effective global cooperation on energy;
Effective global governance of economic migration;
A link between all of the above and the security dimension: radicals
and terrorism, demographic tensions, energy and food supplies, etc.
(5) Spain wants to be among the big players, but is it prepared to
take on the responsibility?
In the previous pages we have argued that the magnitude of the
current crisis and the overall challenges raised by the unstoppable
process of globalisation require a new global contract, or pact, that
features both the major and mid-sized developed countries and the
emerging economies, because otherwise such an arrangement would lack
the legitimacy needed to confront the big challenges of the future.
This new pact or contract could be linked to a deep reform of
existing international institutions, a solution which is probably
more viable that trying to create new organisations from scratch.
It has also been established that Spain: (1) cannot afford to be
passive in its foreign policy, given the challenges that
globalization raises and Spain’s own desire to promote its
political and socio-economic model; (2) it is without a doubt among
the five most important countries of Europe and among the 10-12 most
influential in the world; (3) in its dealings abroad it should strive
to project a mix of ‘hard’ and ‘soft’ power,
as befits a medium-sized international actor; (4) it should aspire to
act in keeping with the prominent role it enjoys as a member of the
EU but also independently, in whatever forums exist or are formed in
the future to shape the international order; and (5) seeks such a
relevant role not out of a mere desire for prestige but rather
because it boasts highly valuable skills and assets that it wishes to
contribute –and defend– in the system of global
governance. In the next section we will examine whether Spain is
prepared to take on the responsibility that this growing international role carries with it.
We should first point out the fact that, in the past decade of so
Spanish diplomacy has failed to give priority to Spain’s
presence in the various selective forums of global economic and
financial governance. Besides the absence we have already noted in
the cases of the G-7/G-8 and G-20 (although Spain was part of the
G-33 that preceded it for several months, before the Group was
created in its current form in 1999), until 2009 Spain was not a
member of the Financial Stability Forum either. Created in 1999, this
institution, which is linked to the Bank for International
Settlements, based in Basel (Switzerland), will possibly play a key
role in the reform of the regulatory system for international
finances and is currently presided over by a Spaniard, Jaime Caruana.
Nor does Spain belong to the older G-10 (created 45 years ago by what
were then the major states that provided loan resources to the IMF;
it was very important in the crisis of the 1970s and today has 12
members). Additionally, Spain is still not a member of either of the
two main committees of the IMF (the International Financial and
Monetary Committee and the Development Committee) which participate
directly in the work of the G-20. In marked contrast, all of the
European countries that are part of the G-8, in addition to the
Netherlands and Switzerland, are members of these four forums we have
mentioned, while Belgium and Sweden belong to three of them.
Along with this specific shortcoming in Spanish foreign policy in the
economic realm (to which one must add the previously mentioned
relatively small quota and number of votes enjoyed by Spain at the
World Bank and the IMF), there are other, more general weaknesses in
foreign policy that are linked to the recurring problem of limited
public funding for the traditional tasks of foreign policy and
defence. The responsibility inherent in being a major player –and
aspiring to a certain degree of global leadership– carries with
it growing commitments in terms of financial and human resources that
must be invested in Spain’s diplomacy and Armed Forces. In
recent years, there has been significant progress. Witness the
resources earmarked for development aid, which, despite the current
crisis, or even more so now, in line with the arguments of this
report, should be maintained or increased. Or think of the recent
announcement that Spain is considering lifting existing limits on the
number of troops it can deploy abroad in overseas missions at any one
time. However, the structural problems posed by Spain’s limited
military budget (the lowest in NATO, when measured as a percentage of
GDP) or the size of its Foreign Service and number of diplomatic
missions (fewer than those of the Netherlands or Sweden) must be
addressed if Spain wants to achieve its goal of playing a greater
role in the process of globalisation. This, as we have stated
earlier, will require the right blend of ‘soft’ and ‘hard’ power.
Improving Spain’s tools for obtaining and exercising influence
is not just a matter of resources, however. It is increasingly clear
that what is also needed is a greater effort at coordination among
the various public institutions that are involved (ministries and
government agencies, Parliament, the autonomous regions and town
halls, amongst others). Spain also needs greater involvement from its
political parties, trade unions and business associations. It must
enhance public-private sector cooperation through tools that allow
for a greater say for ordinary citizens (so-called public diplomacy).
And it must engage its citizens in a debate on Spain’s role in
the world through its think-tanks and the academic community. Indeed,
in order for Spain to assume a position that better reflects its true
weight and potential, it must devise a mid- and long-term strategy –a
real national strategy based on a strong national consensus– and here there can be no delay.
Of course none of this alters the fact that, however much the
material, human or intellectual resources for foreign policy are
enhanced, coordination is improved or the public-private sector
partnership is renewed, Spain’s future leadership in the world
will largely depend on the country’s ability to carry out
certain domestic structural reforms that are also long overdue. One
cannot forget that an effective foreign policy depends to a very
large extent on domestic strength. While Spain’s main overseas
asset is its success at home, its main challenge also lies in its
obvious domestic shortcomings. These, as seen in the indices and
rankings discussed earlier, basically fall into two areas: (1)
education and scientific knowledge; and in close connection with the
former, (2) the problem of low productivity, which leads to reduced
competitiveness abroad and a high dependence on external financing
(in other words, the structural deficit in the balance of payments).
Clearly, the goal of a paper like this is not to list the type of
structural reforms that are needed in these areas. But it should be
noted that in every country there is an underlying connection between
domestic strength and sustainable long-term economic growth and its relevance on the international stage.
Of course the ultimate goal is not to be prosperous in order to
achieve a leadership role in the world; instead, foreign policy
should serve Spain’s domestic prosperity. For this reason, and
since we know that the world’s impact on Spain is unstoppable,
we must take seriously the impact that Spain wants to have on the
world. In other words, Spain should try to shape global processes
through a foreign policy that is intrinsically linked to what is happening at home.
In short, it is clear that the economic crisis is hitting Spain very
hard. But it is up to the government and Spanish society at large to
tap the opportunities that the crisis makes available in order to
provide the country with a significant role in the new world order,
one that allows it to develop its full potential as a global player.
In order to do this, besides the structural reforms needed at the
domestic level, the government must define and pursue its foreign
policy with greater strategic clarity, commitment and effectiveness.
Elcano Royal Institute