Is the G-20 losing its way? The G-20 played a critical role in leading the world out the financial crisis in 2008-9. It was decisive, united and effective in dealing with that crisis. However, it has since lacked that that level of vitality.
The G-20 is a powerhouse. It accounts for about 90% of the world’s GDP, over 80% of the world’s trade and over two-thirds of the world’s population. The G-20 has a special significance for Asia and the Pacific, because it includes six members from the region (Australia, the People’s Republic of China, India, Indonesia, Japan and Republic of Korea). It controls more than 70% of ADB’s shareholding. What gives the G20 the teeth is its leaders’ process, whereby it brings together leaders from the 20 largest economies in one room at least once a year. There is no other forum that achieves this feat.
We have witnessed the emergence of several country groupings in the recent past. However, none holds as much promise as the G-20.
The G-20 declared itself the premier forum for international economic cooperation at the Pittsburgh Leaders’ Summit (2009). There are several critical economic issues crying out for attention by the G-20. We have still not seen the back of the global economic crisis. The G-20 can and should do more to steer the world out of the current economic morass. The G-20 leaders want to put the world economy on the path to “strong, sustainable and balanced growth", and ensure “a more robust and resilient global economy for all.” Much needs to be done to even start that process.
In my view, to achieve these goals, the G-20 needs to do the following:
- Identify a clear niche for itself. The G-20 should be selective. It should focus on a few key issues, using the following criteria: (a) The issue should represent a critical gap in achieving “strong, balanced and sustained growth. (b) The G-20 should be able to add particular value in addressing these gaps. (c) The G-20 should not displace any existing institution in addressing the issue. It should aim to become neither an expanded OECD nor a mini United Nations.
- Commit to clear and quantifiable outcomes. Various G-20 communiqués are replete with calls to prepare roadmaps, action plans, guidelines and assessments. However, they often fail to articulate the outcome sought to be achieved. No roadmap can be prepared without specifying a goal. For example, the G-20 should specify goals for all its streams of work, including the Development Working Group, in a tangible and objectively verifiable manner. Not only will this assist the G-20 in prioritizing its activities, it will also ensure accountability in a transparent manner.
- Deliver on its commitments. The G-20 Leaders’ Statements over the last 6 years have a long list of commitments. Not delivering on these commitments has eroded the G-20’s credibility. The best way for the G-20 to build credibility is to deliver on its commitments. The G-20 process is too important to the world to be discredited by its own inaction. The G-20 has to show leadership and perseverance. It has to ensure that it delivers on its commitments through collective action and that defaulting countries are brought in line through peer pressure.
We have witnessed the emergence of several country groupings in the recent past. However, none holds as much promise as the G-20. It has the potential to make the world a better place. We cannot afford to let this opportunity slip.