G 20 – A decade in multilateralism
– V.Srinivas IAS –
The rise of the G-20 is a significant development on the global economic horizon. The G-20 is the leading forum of world’s major economies that seek to develop global policies to address today’s most pressing challenges. The G-20 has 19 member countries and the European Union, which represent 90 percent of global GDP and 80 percent of global trade and 2/3rds of the global population. The G-20 was born out of a meeting of G-7 Finance Ministers and Central Bank Governors who saw the need for a more inclusive body with broader representation in addressing the world’s financial challenges.
The G-20 has been at the forefront of battling financial crisis – the Global Financial Crisis 2008-09 and the Eurozone Crisis in 2010 – that have taken a devastating toll on global growth and welfare. In the annals history of financial crisis, the London G-20 summit of April 2009 will be acknowledged as the clear turning point when world leaders showed extraordinary determination and unity. There were sharp differences but they were debated and discussed and compromises were made so as to reach the final goal – of ending the crisis. This resulted in an agreed package of measures having both domestic and international components but all of them to be implemented in coordination and in synchronization where necessary. The entire range of crisis response measures – accommodative monetary stance, fiscal stimulus, debt and deposit guarantees, capital injection, asset purchases, currency swaps, keeping markets open were all derived from the G-20 package. G-20 Leaders summits are attended by the Heads of State and Government.
The G-20 was designated as the premier forum for international economic cooperation. It formulated an agenda for strong, sustainable and balanced growth; strengthened international financial regulatory system; reformed the mandate, mission and governance of the International Monetary Fund; deliberated on Energy Security and Climate Change; strengthened the support for the most vulnerable countries and placed quality jobs at the heart of the recovery. The G-20 established the Financial Stability Board (FSB) to include major emerging market economies to coordinate and monitor efforts in strengthening financial regulation. The G-20 was at the forefront of the efforts for shifting 5 percent quota shares in the International Monetary Fund to dynamic emerging markets and developing countries from over represented countries.
Over the past decade the G-20’s agenda has expanded to include additional issues affecting the financial markets, trade and development. The G-20 offers India a place at the High Table to influence and participate in the global decision making processes. Climate change is one area where the pressures of being part of an elite group worked and India accepted the challenge of cutting emissions.
The G-20 Heads of Government and State summit meetings have been held at Washington DC (2008), London and Pittsburgh (2009), Toronto and Seoul (2010) Cannes (2011), Mexico City (2012), Rome (2013), Brisbane (2014), Antalya (2015), Hangzhou (2016) and Hamburg (2017). The real power of the G-20 is multilateralism. A diverse group of stakeholders and international institutions came together to make globalization work better for all.
In 2016, the G-20 committed itself to the Action Plan on the 2030 Agenda for Sustainable Development including the Sustainable Development Goals (SDGs) and the Addis Ababa Action Agenda on Financing for Development (AAAA). The 2030 Action Plan envisaged bold transformative steps through both collective and individual concrete actions at international and domestic levels.
How did the G-20 share the benefits of globalization? The G-20 has strived to reduce excessive global imbalances, promote trade and investment cooperation, sustainable global supply chains, harness digitalization and boost employment. It also sought to build resilience through the global financial system through the Financial Stability Board, reformed the International Financial Architecture and promoted international tax cooperation. The G-20 further sought to improve sustainable livelihoods with its endeavors in energy and climate despite the United States Plan to withdraw from the Paris Agreement. The G-20 assumed the responsibility for launching the Africa Partnership in recognition of its goal for fostering sustainable and inclusive economic development.
The G-20 meetings have enlarged in scope and number over the past decade. The G-20 meetings in Argentina in 2018, will have 60 Working Group Meetings, 11 Finance Meetings, 41 Sherpa Meetings, 7 Engagement Group Meetings and 1 Leaders Summit. The G-20 today represents the world’s foremost facet of multilateralism.
This series of 10 articles authored for the INVC would present the progress achieved in each of the G-20 Summit meetings and the issues taken up by the G-20 in each of the summit meetings from 2008-2018 documenting the specific milestones achieved and the consensus on globalization efforts. It would examine the challenges to multilateralism at a time when the United States is distancing itself from global institutions, Brexit, the rise of Germany and China and India’s role in promoting multilateralism.
World Economic History
About the authorV.Srinivas IASSenior Bureaucrats and Author
V.Srinivas is an IAS officer of 1989 batch, presently posted as Chairman Board of Revenue for Rajasthan
He had previously served in the Ministry of Finance and as Advisor to Executive Director (India) IMF, Washington DC. Also worked as Planning and Finance Secretary of Rajasthan.
Disclaimer : The views expressed by the author in this feature are entirely his own and do not necessarily reflect the views of INVC NEWS.