G-20 Summit and the changing Global Scenario
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TOPIC: General Studies 2:
- Bilateral, regional and global groupings and agreements involving India and/or affecting India’s interests
- Important International institutions, agencies and fora- their structure, mandate.
G20: The G20 (or Group of Twenty) is an international forum for the governments and central bank governors from 19 countries and the European Union. It was founded in 1999 with the aim to discuss policy pertaining to the promotion of international financial stability.
India: Member of G20
Other members: The G20, short for “Group of 20”, is made up of 19 countries: Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, South Korea, Mexico, Russia, Saudi Arabia, South Africa, Turkey, the United Kingdom and the United States, plus the European Union. Spain is a permanent guest and always participates in the G20 summits.
Together, the G20 members represent –
- Two thirds of the world population.
- 85% of the global gross product.
- 75% of international trade.
- 80% of global investments in research and development.
Because the G-20 is a forum, its agreements or decisions have no legal impact, but they do influence countries’ policies and global cooperation.
Why was the G20 created?
The G20 was conceived in 1999, while the repercussions of the Asian financial crisis of 1997 still lasted. The committee’s inaugural meeting took place in Berlin in December 1999.
- In a meeting of finance ministers and presidents of central banks of the G7, it was decided to expand the group and make it more representative in order to generate policies that have an impact In the economy.
- They decided to invite a group of key emerging economies to a new forum of finance ministers and presidents of Central Banks, which would later become the G20.
- With the start of the global financial crisis of 2008, the G20 became the main instrument to face the debacle. And for that it was essential to involve the highest ranking officials. Thereafter, presidents and heads of state joined the G20.
What impact does the G20 have?
The G20 is the most important forum for international cooperation. During the meetings, the main challenges of the world are discussed and the main policies are coordinated at the global level. In the face of an uncertain international context, international cooperation is key, and thus the G20 acquires even more relevance.
The main achievements of the G20 include:
- The increased participation of emerging countries in global issues,
- The reform of international financial institutions,
- The monitoring of national financial institutions,
- The improvement in the regulations of the economies whose problems led to the crisis and the creation of safety nets to prevent problems in the future.
The G20 also specifically helped to provide emergency funds during the 2008 crisis and plays an important role in financing for development.
The Way Ahead:
G20 members should start by endorsing the terms of reference of the G20 trade and investment working group (TIWG), and define it as a sustainable platform for trade and investment cooperation.
- Will show the existence of a consensus on the value and potential of a trade and investment working mechanism.
- Will be effective in helping trade ministers reach agreements on various important issues.
Leaders at the G20 Summit should inject a stronger political impetus for trade and investment cooperation by highlighting a few key principles and frameworks. Trade ministers have made progress in agreeing on a couple of substantial issues, including plans to combat trade restrictive measures, to increase the coherence of trade and investment policies, and to enhance the transparency of regional trade agreements.
Ensure there are regular interactions between G20 officials and independent, specialized experts.
- They bring and generate independent and global views. Participating officials and experts do not represent their countries or institutions; instead, they are global citizens discussing possible trade and investment cooperation under the G20 in a free and non-negotiating environment. This helps G20 officials prepare for the TIWG with a clear global picture in addition to their own countries’ perspective.
- These interactions provide specialized expertise. There have been so many new developments in such a short space of time in the area of trade and investment, which means there’s a real need for a safe space for mutual learning between officials and experts.
India will chair the G20 in 2022.
The G20 Troika: Every year, when a new country assumes the presidency (Argentina in 2018), it works hand in hand with the previous presidency (Germany) and the next presidency (Japan) in what is known as the troika. This ensures continuity in the group’s agenda.
Where is the G20 headquarters?
The G20 does not have permanent offices or employees. The country that presides over the group (in a year) takes care of all the organization and the logistical coordination of the meetings.
Connecting the Dots:
- Is G20 really what the world really needs? Or is this merely a club where leaders meet annually to issue insipid and irrelevant communiqués? Examine
Note: For the first time, India will host the annual G20 summit in 2022, coinciding with the country’s 75th anniversary of Independence.
Connecting the Dots:
- Despite passing more than a decade of its establishment, the G-20 organisation has not been successful to attain its purpose and objectives. Critically comment with suitable examples.
- Even though the G20 platform is meant to promote global economic recovery, promote sustainable development and discuss the roadmap for combating climate change, the recent terrorist attacks have brought terrorism at the forefront of discussions. It only shows that global prosperity and development is possible only in an atmosphere of peace and harmony. Comment.