It was feared to signal a loss of momentum, but the G20 Summit in Pittsburgh started with a bang and ended up covering a huge amount of ground.
Earlier than expected President Obama revealed his preferences for the future outlook of global economic governance. He put on the table two of the issues which had been looming for some time. The first is the recognition of the G20 as the permanent forum for international cooperation and the second the reform of the IMF board.
These two issues are implicitly related, as they both recognize that the balance of power needs to be tilted towards the new rising powers. Streamlining the G process - something which President Obama had hinted at during this year's G8 in Italy - and shifting responsibilities from the G8 to the G20 would imply a dilution of influence for some of the G8 countries, in particular Italy and Canada, and to some extent Japan at the regional level.
Shifting - by a five-percentage-point - the ownership of the IMF from industrialized to developing countries and cutting the number of directors to 20 from 24 would hit the main European economies - Germany, France and the UK, each with a director on the IMF board. In both cases the loss in power would come from European nations, whose global economic weight has shrunk over the past two decades.
The US administration rightly acknowledges the urgency of addressing the representation of the developing countries and adjusting the global balance of power. This, however, involves a shift - in a zero-sum game - from Europe to the developing world. Is Europe ready for this?
By disclosing his vision for global economic governance, President Obama, perhaps unintentionally, has pushed the ball in Europe's court. It is now up to Europe to decide how to play. There is no easy way out as Europe's main countries will eventually have to accept a rebalance of power towards the developing world. But this could also be an opportunity for them to act together and focus on Europe's external representation.
As a Chatham House report* suggested earlier this year, the best option for Europe is to propose the collapse of the European seats on the IMF board into a EU seat with voting rights proportional to the size of the EU economy. The alternative - the stubborn defence of power - would be a long and messy business with no long-term benefits.
* New Ideas for the London Summit: Recommendations to the G20 Leaders, Chatham House Report, March 2009