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Concerns of G-20 leadership

by Ramesh Thakur

Australia recently completed the first year of its two-year term on the United Nations Security Council. Meanwhile, on Dec. 1, Australia assumed the presidency of the Group of 20, which will meet in Brisbane this year. As in the difference between form and class, Australia’s membership on the Security Council is temporary while that on the G-20 is permanent.

Australian Prime Minister Tony Abbott wants the Brisbane summit to focus on “removing the international impediments to trade, jobs and growth” (The Australian, Dec. 2). This misses two key features about the G-20: how it reflects the changing geopolitics and the resulting need to move beyond economics as its sole remit.

Given Australia’s unique G-20 geopolitical identity as a Western nation on the edge of Asia, Canberra should show more entrepreneurial leadership for a body that brings together prime ministers and presidents, not just finance ministers, of all countries with clout.

In purchasing power parity dollars, the combined GDP of the five BRICS countries (Brazil, Russia, India, China and South Africa) surpassed that of the EU-27 around 2007 and is set to overtake that of the Group of Seven around 2023. Their economic potential and massive populations gives them significant political clout. But the global governance architecture has not changed to accommodate the new geopolitical reality.

The pre-eminent global forum around which much of the world’s mandated multilateral system is organized is the United Nations. Its unique legitimacy flows from its universality, which also makes it a terribly inefficient and frustrating body for making, implementing, and enforcing collective decisions.

Conversely the small size of the G-7/8 facilitated easy and highly personalized decision-making but rendered its outcomes increasingly unrepresentative of population, economic, military, and diplomatic power and influence. Accordingly the G-8′s efficiency as a compact decision-making body comes at considerable cost in both legitimacy and effectiveness.

In a world in which all politics is stubbornly local but most big-ticket problems are global, the G-20 is uniquely placed to bridge the global governance gap. It represents both established and emerging powers and countries from very different political, economic, cultural and religious traditions. Unlike the Security Council permanent membership, it includes all the world’s systemically significant powerhouses and regional heavyweights. The G-20 accommodates both the old G-8 and the new BRICS, with Russia being the only member of both clubs.

Existing institutions have proven incapable of dealing with key global issues from financial crises to climate change, agricultural trade, and nuclear threats. The G-20 is best placed to bring together all countries that count because of their weight (economic, financial, diplomatic, military, and/or normative). Heads of government — and only they — can transcend narrow national interests.

During its first year, the G-20 was rightly praised as a new institution of global economic governance, helping leaders manage the global financial crisis in a much more cooperative and effective manner than their counterparts during the Great Depression. After the 2008 global financial crisis, an institutional innovation like the Leaders G-20 was required to restore confidence and trust, put markets and the financial sector to the service of the public interest, and make globalization work for people and not markets.

As former Canadian Prime Minister Paul Martin, the political godfather of the G-20, puts it, “The question to ask is not how to keep New York, London or German bankers happy, but how to keep the global economy healthy.” The G-20 — not the U.N., International Monetary Fund or World Bank — took the lead in shifting more responsibility through greater voice and vote to emerging economies in the international financial institutions.

Those of us who had been advocating the creation of such a global forum through the preceding decade did so based on a diagnosis of the ills of the existing forums of global governance for tackling most of the persisting world’s challenges and accumulating global deadlocks. The G-20′s defining characteristic is that established and emerging powers are brought to the same top table as peers.

The benefits and demands of such a grouping cannot be limited to the economic and financial sector but must also embrace political, military, and social policies.

At the very first meeting of G-20 leaders in Washington in November 2008, the joint communique committed the leaders “to addressing other crucial challenges such as energy security and climate change, food security, the rule of law, and the fight against terrorism, poverty and disease.”

Top-level issues suitable for G-20 discussion include development, food security and global health. Several different global threats — climate change, desertification, population growth, unsustainable use of resources — are converging and thereby intensifying the crisis of food security.

The emergence of new, deadly and highly contagious diseases, the rapidity with which they can spread to become global pandemics, the lack of border defenses to protect against them, and the greater vulnerability of poor countries and poor people owing to risible preventive and negligible therapeutic care make public health a shared global policy challenge.

Of course, the group should remain lean, focused, and disciplined with a tightly structured agenda. The temptation of agenda expansion has afflicted too many other organizations and forums.

The leaders should take up only those issues — and never too many at any one time — that require and can be shifted with heavy lifting by them.

Uncontrolled agenda expansion can come only at the expense of focus and impact. The G-20 must avoid the “Christmas tree effect” whereby it is weighed down with too many items.

The solution is for the host to identify one core concern for each summit beyond just economic matters. Given that Asia is the only continent where nuclear arsenals are still expanding (in China, India and Pakistan), this would not be a bad topic to put on the Brisbane agenda and ask why, and what can be done about it. Conversely if the G-20 agenda remains limited to economic issues, skepticism would mount about its utility, relevance and need.

There is no reason for the world’s top leaders to commit themselves, in a heavily congested calendar of annual summits, to yet another one for an agenda that can be addressed by their powerful finance ministers on their own in a G-20 Finance meeting, as was the case until 2008.

Ramesh Thakur, a professor in the Crawford School of Public Policy at Australian National University, is the co-editor and co-author of “Reforming From the Top: A Leaders’ 20 Summit” (2005) and “The Group of Twenty (G-20)” (2013).