‘We can achieve more together than by acting alone.'
The G20 leaders’ closing words were aimed at a global audience – it felt like they were still trying to convince themselves. The events of Hamburg have shone further light on the divide that presently exists in global politics.
On trade, the longstanding pledge against protectionism was reiterated once again. However, this time we saw something new, with recognition on ‘the role of legitimate trade defense instruments.’ The American spelling gives the game away – this is a clear concession driven by the US.
At least there was agreement on the language. There was no such compromise on climate change. Just a clear manifestation of the split within the G20. The remaining 19 members pledging continued support and stating that “the Paris Agreement is irreversible”. The new branding of the G20 as G19 plus 1 has emerged.
Action speaks louder
Great progress had been made by leaders in the G20 trade and climate agenda over the years. So the further weakening of this position at Hamburg, does little to ease global uncertainty over policy direction. However, the utility of a functioning G20 lay beneath the big headline issues. Leaders were able to reach unanimous agreement in certain areas.
A number of important decisions and outcomes demonstrate a collective resolve among all 20 members to tackle common challenges aimed at raising global growth. Delivering better living standards and quality jobs worldwide also garnered collective enthusiasm as did the role international investment has to play in promoting growth which is inclusive.
In addition to reaffirming the crucial role of the rules-based international trading system, G20 called for the full implementation of the WTO Trade Facilitation Agreement. The importance of open bilateral, regional and plurilateral trade agreements was also acknowledged. Inclusivity and transparency are the watchwords in complementing multilateral trade deals. In the past, however, we have seen a gulf between commitments at a summit and action. Remember Brisbane?
Weaker than desirable
The G20 leaders recognise an open financial system, based on agreed international standards, “is crucial to supporting sustainable growth.” They also reaffirmed a commitment to the financial sector reform agenda in Hamburg. Three years ago in Australia, it was agreed that growth in G20 nations should rise by at least 2 per cent over five years, adding more than $2 trillion to the global economy. Hamburg had a distinctly bearish tone, with leaders admitting world growth was slower than expected. “Weaker than desirable” is putting it mildly.
An Interconnected World
The 2030 Agenda for Sustainable Development saw concrete commitments from the summit. As part of this, digitalisation has been introduced as a new topic on the G20 agenda, including the launch of the G20 Roadmap - ensuring all citizens are digitally connected by 2025. As Co-Chair of B20’s Financing Growth and Infrastructure Taskforce, it’s heartening to see G20 Leaders championing infrastructure development in low-income nations to assist in achieving this ambition.
Free flow of information – respecting frameworks for privacy, data protection and IP rights – will support innovative, inclusive and sustainable growth. It can act as a catalyst for reducing inequality. Given the right global policies for e-commerce, we can ensure that no matter their location, companies can benefit from equal access to international markets.
Perhaps the most damning insight came a day before the summit with the release of the ICC’s Open Markets Index. It revealed G20 nations rank below the global standard in terms of openness to trade. Of the member countries, only Canada is placed among the world’s most open markets. With so few measurable outcomes articulated in Hamburg, it’s difficult to see this changing anytime soon.
G19 plus 1 is a tag that must be lost before the caravan arrives in Argentina next year's G20 Chair. To achieve that will require a global political focus that may be beyond the capabilities of Argentina. Can we really afford to waste a year?