IT was said of the first great summit of modern times, in Versailles in 1919 at the conclusion of the First World War, that the heads of government assembled there turned victory into ultimate defeat. As the heads of government of the Western world meet together tomorrow in Tokyo for their third get-together since the ending of the Cold War, they are in danger of duplicating that earlier feat. Virtually the only saving grace as the Group of Seven (G-7) industrialised nations convene for their 19th annual summit, is that never before has their meeting been the target of so much cynicism, criticism and even outright derision. So much so, that the hope must be that all the doubts and questioning will force the participants to produce a much better than expected result. Amidst the lack of G-7 vision and problem-solving, plus pervasive domestic preoccupations, that could well be expecting too much. Already one summit delegate has declined to attend. The French Prime Minister Edouard Balladur, who was due to accompany President Francois Mitterrand, turned down a trip to Tokyo on the grounds that ''I have no need to parade around here and there while there is a lot to do in France''. The G-7 malaise boils down to two over-arching problems. Economically, with the world slow to emerge from recession, there seems little chance that the summit will break the numerous deadlocks preventing the successful conclusion of the Uruguay Round of trade liberalisation negotiations sponsored by the General Agreement on Tariffs and Trade (GATT). Politically, there seems even less chance that the G-7 summit will bring any strength to bear to reverse the trend towards growing world disorder - rather than the new world order that was too easily promised as the Cold War concluded. The G-7 summits were, of course, originally designed to deal with economic matters. Now there can hardly be any more important step to take than make the compromises that will bring the Uruguay Round to a conclusion. It is estimated that the net result of the trade liberalisation which the GATT agreement promises will stimulate an extra US$200 billion in trade over the next decade. There are those who argue that the Uruguay Round was too ambitious in design, covering as it does trade in 15 separate areas, including highly contentious fields of agriculture, services, and textiles. As things stand, a final bargain has yet to be struck in any of these 15 areas, although ministers are trying to settle the issue of tariff concessions in the trade of industrial products before the summit begins this morning. APART from anything else, G-7's credibility is on the line. At each of the past three summits, leaders have called for a speedy conclusion of the Uruguay Round by year's end. Each time the stalemate continued. Now the need for action relates to another key factor. President Bill Clinton has convinced Congress to extend the period in which he can put the treaty resulting from the Uruguay Round on the legislative fast-track. Clinton's December 15 deadline is the effective deadline by which all negotiations must be completed. It can only be met if the summit encourages the kind of sense of urgency and and willing to make concessions to break trade talks log jam. There is absolutely no sign of this happening. On the contrary, the recent wide-ranging US imposition of dumping duties on imported steel looks as if it will erect yet another roadblock to progress. Another roadblock to progress is likely to be the attention paid to Japan's great and growing trade, and current account surpluses. International Monetary Fund figures show that while the US will have a current account deficit of US$232.2 billion in 1993and 1994, Germany a deficit of US$51 billion, Britain a deficit of US$51.9 billion, Japan will enjoy a combined surplus in those two years of US$265 billion. These figures are simply politically unsustainable. The Japanese, as the summit hosts, were almost duty-bound to show imaginatively some awareness of this fact. But all that Tokyo has done is to issue new projections for increased Japanese aid to developing countries - figures which satisfy none of Japan's G-7 partners, given the well-known tendency of Japanese aid to increase its trade surplus. On the deficit-surplus issue, if the summit avoids bitter recriminations, it will be doing well. ON the political side of the summit, the prospects are no brighter. A year ago, UN Secretary-General Boutros Boutros-Ghali produced a timely report on the urgent need for permanent peace-enforcing forces to be developed under UN command. Given the growing number of situations requiring UN intervention, it seemed only common sense. Yet the G-7 nations, far from facing up to the challenge, either pigeon-holed the report or opposed it. Here, too, the G-7 should be anxious to repair its tattered credibility. A year ago, the G-7 political declaration called upon Serbia to ''respect the territorial integrity'' of Bosnia and Herzegovina, implicitly threatening to take unified action if fighting continued. Indicating a dangerous situation wherein threats by major powers are blithely ignored by smaller ones, the Serbs took no notice. A year later, during which fighting has been continuous, Bosnia is being carved up by the Serbs and the Croats, and the G-7 allies have been unable to take any meaningful unified action. US Secretary of State, Warren Christopher, when asked what action G-7 will now take over Bosnia, replies ''I have no idea'', thereby further emphasising the view of those who suggest that G-7 summits have outlived their usefulness and are incapable of dealing with the growing problems of a disorderly world.