SIDDHARTH SINGH BALLB ‘B’ 5011
PRESTIGE INSTITUTE OF MANAGEMENT AND RESEARCH
(DEPARTMENT OF LAW)
TOPIC = GROUP OF 20 COUNTRIES
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brief discription about the g20
Typology: Summaries
2022/2023
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PRESTIGE INSTITUTE OF MANAGEMENT AND RESEARCH
(DEPARTMENT OF LAW)
TOPIC = GROUP OF 20 COUNTRIES
TABLE OF CONTENTS
- 1 INDRODUCTION ............
- ORIGIN AND EVOLUTON.....................................................................
- OBJECTIVE AND FUNCTIONS..............................................................0
- G20 SUMMITS...........................................................................................0
- 5.WHAT TYPE OF ISSUES ADDRESSED BY G20...................................
- 6.WHAT ARE CHALLANGED FACED BY G20...................................
- 7.PROBLEM FACED BY NON MEMBER OF G20………….…...........
- 8.IMPACT ON INTERNATIONAL RELATIONS.............................................
- 9.CONCLUSION & REFERNCES................................................................
ORIGIN AND EVOLUTION
G20 conceived by G7 in response to the series of massive debt crises that has spread across emerging markets in the late 1990s beginning with the Mexican peso crisis 1994, followed by the 1997 Asian financial crisis, the 1998 Russian financial crisis, and eventually impacting the United States through collapse of long – term Capital Management (LCTM) in the autumn of
The G20 was created in response to both to the financial crises that arose in a number of emerging economies in the 1990s ,IT WAS THE DECADE OF FINANCIAL TURMOIL and to a growing recognition that some of these countries were not adequately represented in global economic discussion and governance. In December 1999, the Finance Ministers and Central Bank Governors of advanced and emerging countries of systemic importance met for the first time in Berlin, Germany, for an informal dialogue on key issues for global economic stability. Since then, Finance Ministers and Central Bank Governors have met annually. India hosted a meeting of G20 finance ministers and central bank governors in 2002. G20 was raised to the Summit level in 2008 to address the global financial and economic crisis of 2008.
WHO ARE THE MEMBERS OF G20?
The members of the G20 are Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Republic of Korea, Mexico, Russia, Saudi Arabia, South Africa, Turkey, the United Kingdom, the United States, and the European Union. Spain as a permanent, non-member invitee, also attends leader summits.
ORGANIZATIONAL STRUCTURE OF G
The G-20 operates without a permanent secretariat or staff. The chair rotates annually among the members and is selected from a different regional grouping of countries. The chair is part
of a revolving three-member management group of past, present and future chairs referred to as the Troika. The current chair of the G-20 is Mexico; the next Chair will be Russia. The preparatory process for the G20 Summit is conducted through the established Sherpa and Finance tracks that prepare and follow up on the issues and commitments adopted at the Summits. The Sherpas’ Track focuses on non-economic and financial issues, such as development, anti-corruption and food security, while addressing internal aspects such as procedural rules of the G20 process. The Sherpas carry out important planning, negotiation and implementation tasks continuously. The Finance Track focuses on economic and financial issues. The Sherpa and Finance tracks both rely on the technical and substantive work of a series of expert working groups. Additionally, the thematic agenda is developed through the organization of several Ministerial Meetings, such as the Joint Meeting of Finance and Development Ministers, and the Labour, Agriculture and Tourism Ministerial meetings. The presidency of G20 rotates every year among its member, with the country that holds the presidency working together with its predecessor and successor, also, known as Troika (because 3 countries only selected) to ensure the continuity of the agenda Currently ITALY, INDONESIA AND INDIA are the Troika Countries
WHAT IS THE STRUCTURING AND FUNCTIONING?
The G20 Presidency rotates annually according to a system that ensures a regional balance over time. For the selection of presidency, the 19 countries are divided into 5 groups, each having no more than 4 countries. The presidency rotates between each group. Every year the G20 selects a country from another group to be president. India is in Group 2 which also has Russia, South Africa, and Turkey. The G20 does not have a permanent secretariat or Headquarters. Instead, the G president is responsible for bringing together the G20 agenda in consultation with other members and in response to developments in the global economy. TROIKA: Every year when a new country takes on the presidency, it works hand in hand with the previous presidency and the next presidency and this is collectively known as TROIKA. This ensures continuity and consistency of the group’s agenda.
The Sixth G20 Summit in Cannes in November 2011 reviewed the global economic situation in the backdrop of the Eurozone/Greek crisis. Its major outcomes included regulation of commodity derivatives markets, including Action Plan on Food Price Volatility and Agriculture and increase in transparency of energy markets and an expression of support for recommendations of High Level Panel and MDBs Action Plan on development. The outcome of the Cannes Summit resulted in the 'Communique' and 'Declaration' titled 'Building our Common Future: Renewed Collective Action for the Benefit of All' along with the 'Cannes Action Plan for Growth and Jobs'. The Seventh G20 Summit was held in Los Cabos, Mexcio on 18-19 June 2012 under the Mexican Presidency. Mexico had identified the following as its priorities: i. To promote economic stabilization and structural reforms as foundations for growth and employment; ii. Strengthening the financial system and fostering financial inclusion to promote economic growth; iii. Improving the international financial architecture in an interconnected world; iv. Enhancing food security and addressing commodity price volatility; and iv. To promote sustainable development, green growth and the fight against climate change. The G20 has, since the Pittsburgh framework and the Seoul Development Consensus, recognized that development and global economic issues cannot be tackled separately. Development is crucial for global economic growth, poverty reduction and employment creation. Development Working Group was set up in 2010 under the Sherpas' Track to complement the G20’s economic and financial agenda through multi-sectoral efforts to assist developing countries in areas of importance for the welfare of their societies. Taking forward the development agenda under the G20 DWG, Mexico had chosen Infrastructure, Food Security and Inclusive Green Growth as its development priorities. In addition to Spain, permanent guest of all G20 Summits, Mexico had also invited Benin (as AU Chair), Cambodia (as the current ASEAN hair), Chile, Colombia and Ethiopia to attend the Summit. Among the International Organizations, IMF, WB (both permanent invitees), the UN, ILO, WTO, FAO, FSB and OECD attended the Summit. The Summit came out with the Leaders' Declaration and The Los Cabos Growth and Jobs Action Plan. The Leaders' committed to work with developing countries, particularly low-income countries, and to support them in implementing the nationally driven policies and priorities which are needed to fulfil internationally agreed development goals, particularly the Millennium Development Goals (MDGs) and reaffirmed their standstill commitment until the end of 2014 with regard to measures affecting trade and investment and pledged to roll back any new protectionist measure that may have arisen, including new export restrictions and WTO-inconsistent measures to stimulate exports. Mexico also hosted a number of other meetings at different levels in a diverse range of areas such as Agriculture, Labour & Employment, Economy & Trade, Energy & Commodity Markets, Tourism, Anti-corruption, Disaster Risk Management, Business 20, Think 20, Civil Society & NGOs and Youth 20.
The Indian delegation was led by Prime Minister, Dr. Manmohan Singh. Prime Minister, in his intervention, stated that India was focusing heavily on investment and have set ambitious targets to keep infrastructure investment on track and also put in place a problem resolution mechanism to overcome implementation bottlenecks. PM added that “it can be argued that austerity now will lay the basis for sustained growth later. But there is also an alternative view that with growth impulses as seriously weakened as they are today, synchronized austerity across many countries may not be the right medicine. Financial markets normally favour austerity, but even they are beginning to recognize that austerity with no growth will not produce a return to sustainable debt position”. PM opined that austerity in the debt-ridden members of the Eurozone can work only if surplus members are willing to expand to offset contraction elsewhere in the currency area. India on its part announced contribution of $ 10 billion to mop up IMF's additional firewall system. And the overall commitment by G20 members exceeded $ 450 billion in addition to the quota increase under the 2010 Reform. These resources would be available for the whole membership of the IMF, and not earmarked for any particular region. India and G- 20 India’s participation in the G20 process stems from the realization that as a major developing economy India has a vital stake in the stability of the international economic and financial system. India has been actively involved in the G20 preparatory process both at the Sherpas Track and the Financial Track since its inception. The Prime Minister participated in all seven G20 summits. India’s agenda at the G20 Summits is driven by the need to bring in greater inclusivity in the financial system, to avoiding protectionist tendencies and above all for ensuring that growth prospects of developing countries do not suffer. India has strived to ensure that the focus of the global community remains on the need to ensure adequate flow of finances to emerging economies to meet their developmental needs. India has welcomed the inclusion of development as an agenda item of G20 process at the Seoul Summit and supported the Seoul Development Consensus and the associated Multi- Year Action plans. Prime Minster called for the recycling of surplus savings into investments in developing countries to not only address immediate demand imbalances but also developmental imbalances. India has worked to maintain the dynamism and credibility of G20 deliberations for establishing a framework for strong, sustainable and balanced growth, strengthening international financial regulatory systems, reforming Bretton Woods’s institutions, facilitating trade finance, pushing forward the Doha agenda. India, as a co-chair of Framework Working Group on Strong, Sustainable and Balanced Growth, tried to refocus the energies of the group towards growth, jobs, fiscal consolidation, rebalancing demand from the public sector to the private, and to risks arising from internal imbalances within the Eurozone. India remains committed to the G20 process for achieving a stable, inclusive and representative global economic and financial system. India would take over the Presidency of the G20 with effect from 9 - 10 September 2023
coordinated action. None of this is achieved without consensus, nor is it enforceable, except for the incentive of peer review and public accountability. Not legally binding : the decisions are based on discussions and consensus which culminates in the form of declarations. These declarations are not legally binding. It’s just an advisory or consultative group of 20 members. Polarisation of Interests: o Russian and Ukrainian Presidents are invited to the G20 Summit to be held in November, 2022. The U.S. has already demanded to not invite Russian President, or U.S. and European countries would boycott his address. China’s strategic rise, NATOS expansion and Russia’s territorial aggression in Georgia and Crimea and now Russia Ukraine Conflict in 2022 changed global priorities. Globalisation is no longer a cool word, and multilateral organisations have a credibility crisis as countries around the world pick being ‘G-zero’ (a term coined by political commentator Ian Bremmer to denote ‘Every Nation for Itself’) over the G7, G-20, BRICS.
PROBLEM FACED BY NON MEMBER OF G
The G20’s work has myriad implications for non-member countries. The G process needs to reflect this in a meaningful way. The first step for the G20 to assuming its broader, global responsibility is to push ahead with its efforts to promote growth in the G20 economies, since other countries will also significantly benefit from a stronger, more sustainable and more balanced recovery in the world’s biggest economies. The G20 can do a lot to address non-member countries’ concerns without losing its focus and core agenda. Promoting reform in international organisations and facilitating productive cooperation with non-members and invited guests are two key areas. Now that the G20 approaches its six anniversary , the effectiveness of its outreach process warrants a constructive and outcome-oriented debate. Outreach is of critical importance to the G20’s long-term success. In addition to enhancing its outreach efforts, the G20’s accountability and outcome focus need to be strengthened in order to manifest its position as the world’s ‘premier forum for international cooperation’. G20 and intern In order to achieve a robust global economic growth, the countries which represent and contribute more than 80% of the global GDP came at the Premier forum for International
economic cooperation, which was agreed by leaders at the Pittsburgh Summit in September
- These countries co-operated to discuss and were known as the “Summit on Financial Markets and the World Economy” which is now the G20 Summit. Recently G20 summits started focusing not only on macroeconomy and trade; but also on a wide range of global issues which have an immense impact on the global economy since globalization started progressing and various issues became more intricately intertwined. Those issues included overall development, climate change and energy, health, counter- terrorism, as well as migration and refugees. The G20 has sought to realize an inclusive and sustainable world through its contributions towards resolving these global issues.
IMPACT ON INTERNATIONAL RELATIONS
a) Policy coordination between its members in order to achieve global economic stability, sustainable growth; b) To promote financial regulations that reduce risks and prevent future financial crises; and c) To create a new international financial architecture. Supporting domestic resources: Supporting the Development of More Effective Tax Systems, set out how the G20 can provide leadership and political support for ongoing initiatives, and identified areas requiring additional attention. Progress has been made on a number of fronts through the implementation of a multi-year G20 work program that can help LIDCs benefit from the ongoing and wide- ranging reforms to bring greater transparency to the international tax environment, through exchange of information (automatic and on request), and address tax avoidance by large corporations through the G20/OECD BEPS project. Anti-corruption : The G20 has adopted the 2015-2016 Anti-Corruption Action Plan, which focuses its work on where it can best add value to existing international efforts to reduce corruption and enhance transparency. G20 efforts to fight corruption in their countries as well as abroad, including by promoting transparency of beneficial ownership, promoting international cooperation in the recovery and return of stolen assets to their rightful owners and identifying trends and challenges in anti-corruption legislation and enforcement, have been critical to help address the corruption challenge and tackle illicit financial flows, and improve good governance in high risk areas. Infrastructure: