
Amid rising US-China tensions and a slowing recovery, the G20 must live up to its crisis-solving legacy
- While the G20 earned praise for helping avert financial meltdown in 2008, its relevance is increasingly in question amid waning internal cohesion
- Emerging economies holding the presidency in the next three years could inject the group with more inclusive ideas and greater legitimacy
“If we didn’t have it, we would have to invent it” might well be the catchphrase for the Group of 20 as the international community rethinks global institutional architecture in the face of shifting power dynamics and geopolitical strife.
Of all the international groupings, it boasts the most diverse and compelling mix of nations. It has 80 per cent of global income, three-quarters of global exports, 60 per cent of the global population and 80 per cent of global emissions.
Barely two days after solemn promises were made in the 2008 communique, Russia broke rank and raised tariffs on imported cars. India followed by applying import duties on several iron and steel products.
The seeming parallel to 2008 this year, as the world faces the common threat of the Covid-19 pandemic amid a series of extreme weather and supply crunches, would explain why expectations are running high for Rome and for G20 president Mario Draghi, the Italian prime minister.
Effective crisis response is how the G20 has cut its teeth, and the world is handling several emergencies right now. Draghi himself was chair of the Financial Stability Forum back in 2008.
If defrosting multilateralism was also a shared goal, in addition to economic recovery, general rustiness in the business of international cooperation – an understandable hangover from the Trump years – has also gummed up the works.
Hence, the G20 will have to do much in the coming days to prove that, unlike the G7 in 2008, it has yet to outlive its usefulness, even when some have decried it being missing in action over the Covid-19 crisis.
Customary language aside, the G20’s problem-solving reputation can be oversold. Not surprisingly, it has worked best when members already agree on the next steps. Looking to the future, more hostile power plays are likely to further weaken the cohesiveness and effectiveness of institutions like the G20.
Time to forgive debts as poor nations sink deeper in pandemic
As The Economist said in 2011, “the G20 … is a big improvement over the G7 because it takes emerging economies seriously. But do the emerging economies themselves take the G20 seriously?” Any scorecards would point to severe gaps between words and deeds, most notably but not limited to the emerging economy members.
If the G20 was born out of the need to increase the number of seats at the table, the next three years – with the G20 helmed by Indonesia in 2022, followed by India and Brazil – might prove to be the coming-out party for emerging economies.
They might value the opportunity to wrestle the steering wheel from the old powers and imprint the international community with their own experience and delivery plans for economic development, alongside new and more pro-poor, pro-climate growth models and new models of multilateral cooperation.
Should this happen, it would make the G20 the room where it all happens.
Bernice Lee is director of futures at Chatham House, London
