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G-20(Group of 20 economic powerful countries) summit concluded in the beautiful southern Chinese city of Hangzhou. After completing 17 years of journey, it is worth asking whether G 20 is able to achieve its desired objective? In the present era of economic power struggle , this question become more relevant.
G 20 was formed in 1999 with the aim of studying, reviewing, and promoting high-level discussion of policy issues pertaining to the promotion of international financial stability. The agenda of G20 summits has expanded by addition of macro aspects of trade, finance and economy, the forum also debates political and social issues including terrorism, health, water and several others. However, the record of implementing decisions taken has not been very inspiring.
Animosity, shifting coalitions and potential blocs within the G20 — such as the G7 and BRICS — affect the likelihood of reaching consensus with in group. Since 2009, the bloc of European countries has become very fragmented. Suspicions — over the G7 dictating the G20 agenda, the United States using the Trans-Pacific Partnership to contain China and so on — continue to lower cooperative spirit within the G20
Another area in which the decisions of the G20 have been inadequate is building up international safety nets. Although IMF resources had been increased, the current level of international safety nets is not enough to stabilize the global economy. The international financial system should provide stronger international safety nets in order to reduce the tendency of developing countries to accumulate vast amounts of foreign currency reserves, which cause global imbalances and carry social costs.
The slowdown in the pace of global finance reforms is another problem for the G20. Slow economic growth is spreading all around the globe as developing countries have performed relatively poor since 2013 compared with the first five years after the recession . In this environment of sluggish global growth, increasing investments to promote economic growth is an important challenge that the G20 has to address.
The G20 focuses mostly on reforming the global financial system to increase global economic growth. But the world is also experiencing severe socio-economic problems such as increasing income inequality, youth unemployment and gender inequality. These problems increase social tensions and undermine democracy.
G-20 failed to become either the economic or the political "global steering committee" that it wished to be. It failed to foresee the need to consult nations outside the G-20 about decisions which directly affected them, an error only partly corrected by the emergence of the Global Governance Group, an association of non-G-20 nations inspired and led by Singapore. It also failed to exercise broader transparency and accountability duties.
In the first few years of its establishment, the G20 discussions had produced tangible results in coordinated policy-making and follow-up action but it has since meandered along and lost focus. Its significance has however continued to grow because of the opportunity it provides to world leaders to meet bilaterally with their major partners to discuss and resolve urgent issues of concern and interest.
Even as the G20 struggles to adapt its agenda to the continuing challenges of slow and uneven growth, it’s also showing signs of real movement on bigger things, striking out in new directions on international development and climate change and introducing new practical initiatives – such as the proposed anti-corruption centre – to make global systems work more effectively.
G20 has made important progress in reshaping the governance of global finance by implementing macro-prudential policies, developing strict rules on the "too big to fail" problem, increasing the lending capacity of the International Monetary Fund (IMF) and collecting richer information on the shadow banking system. although the G-20 is a useful framework for discussing global economic problems, it won't be the forum to remake global power relations in the way that those who initially conceived the institution intended.
Way ahead There is need to facilitate G20’s transition from a crisis-response mechanism to one focusing on long-term governance so as to better lead world economic growth and international economic cooperation. G20 has never managed to shake off its image as a rich states’ club, and if it comes up with a meaningful definition of “inclusive” and actual plans and tools to make the world more so, perhaps the rest of the international community will start warming to it.
By: Vishal ProfileResourcesReport error
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