The G-20 and What It Does
World Leaders Address Terrorism, Climate Change and Economic Crises
The G-20 is the G-7 plus developing nations such as Brazil, China, India, and Russia. The G-20's members represent two-thirds of the world's people and 85 percent of its economy. Since 2007, the media has covered each G-20 summit. That recognizes the members' role as significant drivers of the world economy.
The is to prevent future international financial crises. It seeks to shape the global economic agenda. It lends the perspective of Asian and Latin American growing economies. That "broadens the scope of international economic and financial cooperation."
In 1999, these ministers and governors created the G-20. They needed dialogue between developing and developed countries. They were responding to the 2007 Asian currency crisis. The meetings started as an informal get-together of finance ministers and central bankers.
2018 Summit Meeting
The 2018 summit will be held in Buenos Aires, Argentina, on November 30 to December 1, 2018. President Trump and China's President Xi Jinping have during the summit to discuss the ongoing trade war. If the meeting doesn't go well, Trump is prepared to announced additional tariffs on imports from China.
2017 Summit Meeting
July 7-8, 2017: Hamburg, Germany. The It made little progress. U.S. President Donald Trump opposed the views of the other 19 countries. Trump had pulled out of the Paris Climate Agreement. The other G-20 members will hold a follow-up climate summit in December to move forward. Trump also threatened to impose trade restrictions on steel. That could start a trade war. He said there is a supply glut. The G-20 agreed to share information about steel production.
It will publish a formal report by November.
The G-20 agreed to eliminate safe havens for terrorism financing. It will ask the private sector to help. It will address conflicts in North Korea, Syria, and Ukraine.
On July 7, Trump and Russian President Vladimir Putin privately met for two hours. When in the 2016 presidential election, Putin denied it. They agreed to a limited cease-fire in Syria.
Previous Summit Meetings
September 4-5, 2016, Hangzhou, China. to ratify the Paris climate change agreement. They are the two worst emitters of greenhouse gases. Russia and the United States did not agree on ending the Syrian war. China complained that other countries should allow more free trade. But China has become more protectionist itself.
November 15-16, 2015, Antalya, Turkey. responding to the terrorist attacks in Paris. The members agreed to tighten border surveillance against threats. At the same time, they would admit refugees who were escaping the war against the Islamic State group. The United States agreed to share more intelligence with France and other members. It wouldn't send in ground troops. But it would support Syrian and Iraqi forces fighting the Islamic State group. They outlined further steps to cut off financing for the Islamic State group.
November 15 -16, 2014, Brisbane, Queensland, Australia. The meeting condemned Russia's attack on Ukraine. All members promised to work together to percent by 2018. That would add $2 trillion to global economies. The United States and Europe pressured the group to take strong action on climate change. That was not on the official agenda. The leaders vowed to do all they could to combat Ebola in West Africa. President Obama met with the leaders of Japan and Australia.
They agreed to work toward the peaceful resolution of maritime disputes in the South China Sea.
September 5-6, 2013, St. Petersburg, Russia. Unofficially, a response to Syria's chemical weapons attack. President Obama sought support for a U.S. strike, while others argued for economic sanctions. Russia supports the Syrian government with arms and trade. China is concerned about an increase in oil prices. France, Turkey and Saudi Arabia support an air strike. Officially, the leaders focused on spurring global economic growth. The BRIC countries sought G-20 action to reinvigorate their economies.
They were pummeled by a withdrawal of foreign direct investment.
June 18-19, 2012, Los Cabos, Mexico. The summit focused on the eurozone debt crisis. The German Chancellor Angela Merkel to work with other European Union leaders. They wanted a more sustainable Grand Plan to resolve the Greece debt crisis. Germany wouldn't bail out Greece without austerity measures. That's because German taxpayers ultimately face higher costs to fund the bailout. Germany itself is already highly indebted. Germany pushed for a fiscal union to support the EU's monetary union.
That meant EU members would give up political control of their budgets to an EU-wide approval process. This was necessary before she would support Euro-wide bonds.
November 11-12, 2010, Seoul, South Korea. In advance of the G-20 meeting, to stop the currency wars. They occurred primarily between China and the United States. These wars could create global inflation in food, oil prices, and other commodities. U.S.Treasury Secretary Tim Geithner pledged the United States would not flood the market with Treasurys. That would have driven down the value of the dollar. Emerging market countries agreed to let the forex market determine their currency values.
That means they would let them rise, if necessary. This drove the dollar down and the stock market up. Forex traders had hoped for a more substantial pledge by the United States and China to keep their currencies strong. Instead, the Federal Reserve will buy more Treasurys. That will keep interest rates and the dollar low. Traders sold dollars, driving its value down. In response, the Dow rose one percent. A falling dollar value makes U.S. stocks cheaper to foreigners. G-20 members agreed to transfer 6 percent of voting power in the IMF to emerging market countries.
That further shifted the balance of power away from the G-7 nations.
April 1-2, 2009, London, United Kingdom. G-20 leaders pledged $1 trillion to the IMF and World Bank to help emerging market countries ward off the effects of the recession. They promised $250 billion in trade finance. They also agreed to develop new financial regulations, create a supervisory body, and crack down on hedge funds. As a result, the Dow rose over 240 points, rising above 8,000 for the first time in two months.
September 24-25, 2009, Pittsburgh, United States. Leaders established a new Financial Stability Board. It would develop standard financial regulations for all G-20 countries. The Board will work with the World Bank and the IMF. They have been subcontracted to implement many of these policies. They agreed to increase banks' capital requirements. They decided to tie executive pay to long-term, not short-term, performance. They also wanted to move all derivatives contracts onto electronic exchanges.
That way, they can be better monitored. Finally, they suggested that companies that are "too big to fail," like AIG, develop international contingency plans. That would make sure their collapse wouldn't threaten the entire global economy.
November 16-17, 2008, Washington, DC. The G-20 held its first-ever summit. Before this meeting, the G-7 guided most global economic plans. The topic was the 2008 financial crisis. Emerging market leaders asked the United States to regulate its financial markets better. The United States refused. The leaders also wanted better regulation of hedge funds and debt-rating companies such as Standard & Poors. They also sought to strengthen standards for accounting and derivatives. One of the causes of the financial crisis was insufficient regulations and standards.
G-20 Member Nations
There are eleven emerging market and smaller industrialized countries. They are Argentina, Australia, Brazil, China, India, Indonesia, Mexico, Russia, Saudi Arabia, South Africa, South Korea and Turkey. The EU is also a member of the G-20.
Why the G-20 Is Important
The growth of Brazil, Russia, India and China (the BRIC countries) has driven the growth of the global economy. The G-7 countries grow slower. Therefore, the BRIC countries are critical for ensuring continued global economic prosperity.
In the past, the leaders of the G-7 could meet and decide on global economic issues without much interference from the BRIC countries. But these countries have become more critical in providing the needs of the G-7 nations. For example, Russia delivers most of the natural gas to Europe. China produces much of the manufacturing for the United States. India provides high-tech services.
G-20 meetings are usually the site of protests against the G-20 agenda. They claim the group focuses too much on financial interests and globalization. Protesters want the G-20 leaders to focus on one or more of these issues:
- Poverty. The Ontario Coalition Against Poverty leader John Clarke said, “The whole process of putting together this grouping has been about impoverishing people, and benefiting the richest members of society.” In 2010, protesters were against the G-20's focus on fiscal responsibility and austerity at the cost of social programs. They also were opposed to the $1 billion cost of the meeting itself, which was borne by Canadian taxpayers.
- Climate Change. Protesters wanted the G-20 to refocus on global warming as a priority.
- Gender Equality. G-20 countries need to pay more attention to rights for the LGBT community. They ask for more funding for family planning, including abortions.
- Immigration. Protesters sought more open borders for immigrants fleeing "humanitarian and climate crises." (Source: "What the G-20 Protests Are Really About," Alixandra Gould, The Faster Times, June 27, 2010.)