The G20 and the lack of global leadership
Despite its potential, the G20 continues to disappoint as a forum where leaders could tackle global multilateral issues.
Published on 18 November 2015 in
ISS Today
By
As the scale of the terrorist casualties in Paris in last Friday’s attacks became known, French Prime Minister François Hollande cancelled his participation at the G20 summit in Antalya, Turkey and sent his foreign minister Laurent Fabius. Despite Hollande’s absence, terrorism, the related situation in Syria and the impact of the migration crisis on European members of the G20 inevitably dominated the discussion.
Views on the achievements and potential of the G20 differ. An original, and generous, interpretation was that the G20 would be able to bridge the different standpoints on pressing global issues between the relative declining G7 and other groupings – the BRICS (Brazil, Russia, India, China and South Africa) in particular.
Twenty-five years ago, in 1990, the G7 countries and the BRICS respectively represented 59% and 11% of the global gross domestic product (GDP) in market exchange rates. Those numbers have since changed such that the G7 portion of the global economy has declined to an estimated 46% in 2015; and that of the BRICS has increased to 22%. By 2040, the G7 will expectedly represent only 28% of global GDP, and the then-larger BRICS grouping will constitute 39% of global GDP.
In contrast to the changing contribution of the G7 and the BRICS to the global economy, the G20 has represented more than 75% of GDP for the last four decades. If one includes the entire European Union as a member of the G20 and not only the individual members of the G20 (Germany, the United Kingdom, France and Italy), the slice of the global economy represented by the G20 increases even further. The G20 will expectedly continue to represent three-quarters of global GDP for the foreseeable future.
It is always important to temper discussions on shifts in power, influence and economic weight with the recognition that as much as the world is generally becoming more prosperous, the rise in the awareness of inequality (so-called relative deprivation) within and between countries is rapidly emerging as the largest source of instability globally. In addition, global growth in its current resource intensive form is ultimately unsustainable. The world economy today is almost double the size that it was in 1990. It will again have doubled in size from its current levels by 2035.
Far from serving as a forum where global issues such as the implications of the economic growth model could be discussed, the G20 remains modest in its ambitions and disappoints in its achievements. The G7, by comparison, has a much wider political agenda, as ‘participants discuss issues that are of global importance, including global economic issues and foreign, security and development policy. They also address those issues that require political action and that generate widespread interest.’
The G20 gained prominence through the efforts led by President George W Bush in 2008 to combat the global financial crisis; to stimulate growth, enhance financial regulation, increase bailout money and fight trade protectionism. Previously it was a forum for central bank governors and finance ministers – a description still often used by many to peg it to its formal role. As a global recession threatened, in 2008 it became an annual summit including heads of state and government.
During three successive summits, in Washington (November 2008), London (April 2009) and Pittsburgh (September 2009), the G20 established itself as ‘the premier forum for international economic cooperation’, doubling the funds available to the International Monetary Fund (IMF) and setting clear targets for structural reform in the quota and voting power towards the IMF and the World Bank.
During a second phase from the Toronto to the Brisbane summits from 2010 to 2013, G20 leaders extended the scope of discussions to include finance, trade, structural reform, anti-corruption, development, energy security and even Green Growth. Yet the G20 was not able to impact upon a perceived ‘common good,’ such as completing the Doha Round of trade negotiations, and its role has subsequently waned.
During the recently concluded summit in Turkey, President Barack Obama tried to usurp the original agenda of the meeting. He sought to focus discussions on the threat posed by the Islamic State in Syria – a situation largely created by the United States’ (US) invasion of neighbouring Iraq and the subsequent impact of the Arab Spring.
The G20 could help fill the growing gap in multilateral governance in a fragile world
Apart from wall-to-wall coverage of the unfolding investigations in Paris and Brussels after the terrorist attacks, media coverage across major news agencies such as CNN and BCC made no mention of any other matters during the summit. Indian Prime Minister Narendra Modi, a member of the BRICS, proposed a 10-point global response to terrorism, trying to shift the locus of reponses from the G20 to the United Nations (UN) Security Council. He warned of the ‘changing character of terrorism’ and said ‘old structures of terrorism’ were still being used by some countries as an ‘instrument of state policy.
The reference by Modi to the UN, instead of the G20, in dealing with ‘one of greatest human challenges’ is an important recognition of the limits of informal, club-style global cooperation.
From a structural point of view, terrorism and migration are driven by the same dynamic; the rise in global and regional awareness of inequality in a globally interconnected world – as some grow wealthier and many become progressively marginalised. Work by the Institute for Security Studies points to the potential for long-term instability in the Middle East and North Africa due to its inclusion deficit and, to a lesser extent, in sub-Saharan Africa as a result of the limited capacity of governments – what we refer to the ‘thinness’ of governance.
These are matters outside of the ability of exclusive clubs to respond to. In contrast to the G7 and the BRICS, the G20 has the potential to help fill the growing gap in multilateral governance in a fragile world as the permanent members of the UN Security Council cling to their privilege accorded after the Second World War almost three-quarters of a century ago.
As China prepares to host the 11th G20 summit in Hangzhou next year, it is unlikely that it will take any bold initiatives that could respond to these challenges. Like Antalya, Hangzhou will allow President Xi Jinping to showcase his vision for China, but he will expectedly exercise cautionary leadership. So much more is needed.
Jakkie Cilliers, Executive Director, Institute for Security Studies
