Hi all, did you all get to enjoy summer holidays?
This summer was particularly hot in Seoul, and it was only 2 weeks ago that the heat wave warning was issued here with temperature going up to 36 celcius degrees. Now it’s much cooler(relatively, of course), but I suppose many of you went on/fancied a beach holiday.
Well, while the beach resort is a perfect place for chilling out and enjoying the sun in swimsuit, it can also be a venue for the head of states (of course in suits) to gather together and discuss serious, impending global economic challenges. And it actually happened, recently in Los Cabos, a popular beach holiday destination in Mexico.
As you may already know well, the G20 is a premier economic forum for world leaders to gather together annually, discuss global issues, and draw common solutions. This year’s G20 was held on 18-19 June, with participation of 20 member states (including Korea, US, UK, France, Germany, Japan, and all BRICS countries), 6 invitees, and 8 international organisations (including IMF, WB, WTO), among others.
* The G20 member countries: Korea, US, UK, Germany, Japan, Italy, Canada, France, Russia, China, India, Indonesia, Australia, Brazil, Mexico, Argentina, South Africa, Saudi Arabia, Turkey, and the EU
What did they discuss? The discussion of Summit mainly focused on the Euro zone crisis and global economic recovery.
And, what was the achievement? The main results of the Summit would be the Leaders’ Declaration and the Los Cabos Growth and Jobs Action Plan. The key message was that the G20 will collectively endeavour to boost global economic growth and undertake various financial/fiscal measures to address short-term issues, such as the Euro zone crisis, as well as mid-to-long term tasks, such as sustainable growth and having strong economic fundamentals.
More details about some of the G20 leaders’ commitments are as follows;
: 1) Global economic recovery and job creation, by urging integrated financial architecture in Europe and strengthening fiscal consolidation with a view to boost economic growth,
2) Enhancing global financial safety net, by increasing IMF resources (which now exceeds $450billion),
3) Changing the governance structure of international financial institutions, including IMF and FSB, in order to reflect the changes in global economic landscape,
4) Safeguarding open trade and investment by extending the standstill commitment to 2014,
5) Promoting green growth in order to promote long-term prosperity,
6) Meeting the challenges of development by fulfilling MDGs and supporting infrastructure investment in developing countries,
and 7) Internationally cooperating to fight against corruption and bribery,
You may think that’s a lot of details, but actually I’ve named just some of the important agreements from the G20 discussions. Only a few! Now, you can see how comprehensive the G20 agenda are, can’t you?
Now, as some time has passed from the G20 Summit, you may wonder how it could be assessed in terms of effectiveness of the consensus. Though there are varying opinions, the G20 made solid contribution to global economic stabilization, by increasing IMF resources, and extending the standstill commitment to 2014.
It also reflected changes in global governance, in which emerging economies are increasingly setting the tone and agenda. For example, all the BRICS countries substantially contributed to IMF resource increase at this year’s G20, and simultaneously the IMF quota reform and FSB’s governance change were demanded by the emerging nations.
And that’s not all! Development and green growth, the agenda led by Korea, Mexico, and other developing nations, became the main agenda in G20 as well. I’m very proud to say that Korea, as a host country of the 2010 Seoul G20 Summit, actively contributed to this year’s Los Cabos Summit in developing agenda (such as development, green growth) and building consensus (including standstill commitment) among the member countries.
However, there are some sensible criticisms that the G20 is loosing effectiveness and efficiency in global economic decision-making. For the G20 not to become another talk shop, while the genuine willingness of heads of state to bring out actual, constructive changes in global issues is a precondition, the G20 should enhance the implementation and monitoring process – as discussed in Los Cabos. Moreover, the cooperation and discussion mechanism of the G20 should become more systematic, and creating an online/physical secretariat could be a step towards it. At this point, I should like to note that Korea, with its experience as the previous G20 chair country and agenda setter, along with its robust IT strength, is well qualified and most willing to contribute to such operational improvement process of the G20.
The next G20 Leaders’ Summit is to be held in St Petersburg, Russia, and the preparation process is already ongoing. The global economic uncertainty lingers on, but with the cooperation and commitment of G20 countries, and enhancement of its working mechanism, the G20 will be able to continuously serve as a premier economic forum in the global stage.