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Editorial Articles

volume-37,15-21 December 2018

G-20: Promoting multi- faceted  

cooperation Amongst Major economies


Shishir Sinha

Top 19 nations will join India to celebrate its 75th year of independence in 2022 as Prime Minister Narendra Modi announced, at the concluding session of G20 Argentina, "India looks forward to welcoming the world to the G-20 Summit! Come to India, the world's fastest growing large economy. Know India's rich history and diversity, and experience the warm Indian hospitality."

No doubt, this became headline day after conclusion of two days (November 30-December 1) summit held at Buenos Aires, Argentina, but there were many important issues discussed there and of course Leaders' declaration which are very-very important for the entire world. This meeting was 13th in the series after first meeting took place ten years ago in Washington, D.C., when heads of State and Government from around the world put together an action plan to address the 2008 financial crisis. Though, prior to the meeting, fear of similar crisis was looming large due to trade war between US and China, however, a day after summit fear seems to be getting thinner as both nations announced a cease-fire in their tariffs war.

The Group of Twenty may comprises of just 20 twenty nations, but they are world's major economies- 19 countries (Argentina, Australia, Brazil, Canada, China, Germany, France, India, Indonesia, Italy, Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey, the United Kingdom and the United States) and the European Nations. Collectively, G20 members represent all inhabited continents, 85% of global economic output, 66% of the world's population, 75% of international trade and 80% of global investment. All these signify importance of G20 meetings.

Importance of such meeting for India was well articulated by PM Modi in his departure statement prior to attending the G-20 Summit. "The G-20 seeks to promote multi-faceted cooperation among the twenty largest economies of the world. Through the ten years of its existence, G-20 has strived to promote stable and sustainable global growth. This objective is of particular significance for developing countries and emerging economies such as India, which is today the fastest growing large economy in the world. India's contribution to global economic growth and prosperity underlines our commitment to 'Building Consensus for Fair and Sustainable Development', which is the theme of the Summit," he said.

Tri-laterals and Bi-laterals

On the sidelines of summit, PM hold two tri-laterals and many bi-laterals with world leaders.  While first tri-lateral involve Japan-America-India (JAI), the second tri-lateral involves Russia-India-China (RIC). Terming 'JAI' meeting as a historic meeting and a great beginning, Modi said, this marks the coming together of three friendly nations. "(PM Abe, President Trump and I) held fruitful talks aimed at furthering connectivity, maritime cooperation and a stable Indo-Pacific," he said in a tweet. These leaders agreed that a 'free, open, inclusive and rules-based' order is essential for peace and prosperity in the Indo-Pacific.

The second tri-lateral was equally important. Taking place after 12 years, three leaders (PM Modi, Russian President Putin and Chinese Premier Jinping) discussed a wide range of subjects that would further cement the friendship among these nations and enhance world peace. Later the External Ministry Affairs said that meeting characterised by warmth and positivity, leaders discussed cooperation and coordination in various areas which could contribute to global peace and stability. Apart from these two key meetings, Modi held bilateral meeting with the Argentina President Mauricio Macri, French President Emmanuel Macron, South African President Cyril Ramaphosa, Netherlands PM Mark Rutte, German Chancellor Angela Merkel and his Spain counterpart Pedro Sanchez. All these aimed to help further boosting relationship with India.

Leaders' Declaration

Here are the key points of the declaration, signed by all the leaders and issued at the end of the summit:

. Ten years since the first G20 Leaders' Summit we met in Buenos Aires, Argentina, on 30 November-1 December 2018 to build consensus for fair and sustainable development through an agenda that is people-centred, inclusive and forward-looking.

.  This y ear we have focused on the following pillars: the future of work, infra-structure for development, a sustainable food future and a gender mainstre-aming strategy across the G20 agenda.

.  Transformative techno-logies are expected to bring immense economic opportunities, including new and better jobs, and higher living standards. The transition, however, will create challenges for individuals, businesses and governments. Policy responses and international cooperation will help ensure that the benefits of the techno-logical transformation are widely shared. We endorse the Menu of Policy Options for the Future of Work which we will draw on, considering individual country circumstances, to: harness technology to strengthen growth and productivity; support people during transitions and address distributional challenges; secure sustainable tax systems; and ensure that the best possible evidence informs our decision-making.

.  Access to education is a human right and a strategic public policy area for the development of more inclusive, pros-perous, and peaceful societies. We underline the importance of girls´ education. To equip our citizens to reap the benefits of societal and technological innovations we will promote coordin-ation between employment and equitable quality education policies, so we can develop compreh-ensive strategies that promote key competences such as learning to learn, foundation and digital skills, in a lifelong learning perspective from early childhood. We acknow-ledge the need to foster evidence-based innovative pedagogies and methods for all levels of education.

w            To maximize the benefits of digitalization and emerging technologies for innovative growth and productivity, we will promote measures to boost micro, small and medium enterprises and entrepreneurs, bridge the digital gender divide and further digital inclusion, support consumer protec-tion, and improve digital government, digital infras-tructure and measurement of the digital economy. We reaffirm the importance of addressing issues of security in the use of ICTs. We support the free flow of information, ideas and knowledge, while respecting applicable legal frameworks, and working to build consumer trust, privacy, data protection and intellectual property rights protection. We welcome the G20 Repository of Digital Policies to share and promote the adoption of innovative digital economy business models. We recognize the importance of the interface between trade and the digital economy. We will continue our work on artificial intelligence, emerging technologies and new business platforms.

. Infrastructure is a key driver of economic prosperity, sustainable development and inclusive growth. To address the persistent infrastructure financing gap, we reaffirm our commitment to attract more private capital to infrastructure investment. To achieve this, we endorse the Roadmap to Infrastructure as an Asset Class and the G20 Principles for the Infrastructure Project Preparation Phase. We are taking actions to achieve greater contract-ual standardization, address data gaps and improve risk mitigation instruments. In line with the Roadmap, we look forward to progress in 2019 on quality infrastructure.

. Gender equality is crucial for economic growth and fair and sustainable development. We are making progress in achieving our Brisbane commitment to reduce the gender gap in labour force participation rates by 25% by 2025 but affirm that more needs to be done. We will continue to promote initiatives aimed at ending all forms of discrimination against women and girls and gender based violence. We commit to promoting women's economic empowerment, including by working with the private sector, to improve labour conditions for all, such as through access to quality and affordable care infrastructure and parental leave, and reducing the gender pay gap. We also commit to promote women's access to leadership and decision-making positions, the development of women and girls' digital skills and increasing their particip-ation in STEM (Science, Technology, Engineering and Mathematics) and hightech sectors. We welcome the continued implementation of the Women Entrepreneurs Financing Initiative (We-Fi), and we thank the Business Women Leaders' Taskforce for its work. Drawing from this experience, we will consider how to better engage with women entrepreneurs.

. We reaffirm our commitment to leading the transformation towards sustainable development and support the 2030 Agenda as the framework for advancing this goal and the G20 Action Plan. The Buenos Aires Update outlines the G20 current collective and concrete actions towards achieving that Agenda, recognizing that South-South and triangular cooperation have an important role to implement it. We underline our continued support to the G20 Africa Partnership, including the Compact with Africa, and other relevant initiatives. We reaffirm our commitment to addressing illicit financial flows that have a detrimental effect on domestic resources mobilization and will continue to take stock of progress. We endorse the G20 High Level Principles on Sustainable Habitat through Regional Planning.

.  A strong economy and a healthy planet are mutually reinforcing. We note the latest IPCC Special Report on the Impacts of Global Warming of 1.5 degrees centigrade. We recognize the importance of comprehensive adaptation strategies, including investment in infrastr-ucture that is resilient to extreme weather events and disasters. In this sense, we support actions and cooperation in developing countries, especially those that are particularly vulnerable, including small island states such as those in the Caribbean. We discussed long-term low greenhouse gas emission development strategies and alignment of international finance flows. We also shared countries´ experiences and considered the 2018-2019 work program on adaptation, acknowledging that each country may chart its own path to achieving a low emission future. We look forward to successful outcomes of the UNFCCC COP24, and to engage in the Talanoa Dialogue.

.  Signatories to the Paris Agreement, who have also joined the Hamburg Action Plan, reaffirm that the Paris Agreement is irreversible and commit to its full implementation, reflecting common but differentiated responsi-bilities and respective capabilities, in light of different national circumst-ances. We will continue to tackle climate change, while promoting sustain-able development and economic growth.

. We will continue to monitor cross border capital flows and deepen our understanding of the available tools, so we can harness their benefits while also managing the risks and enhancing resilience. We will continue to take steps to address debt vulnerabilities in low income countries by supporting capacity building in public debt and financial management, and strengthening dome-stic policy frameworks. We will work towards enhancing debt trans-parency and sustainability, and improving sustainable financing practices by borrowers and creditors, both official and private, including infrastructure financing. We support ongoing work by the IMF, WBG and Paris Club on LICs debt and the continued efforts of the Paris Club towards the broader inclusion of emerging creditors. We welcome the final report of the G20 Eminent Persons Group on Global Financial Governance.

. We will continue our work for a globally fair, sustainable, and modern international tax system based, in particular on tax treaties and transfer pricing rules, and welcome international cooperation to advance pro-growth tax policies. Worldwide implementation of the OECD/G20 Base Erosion and Profit Shifting package remains essential. We will continue to work together to seek a consensus-based solution to address the impacts of the digitalization of the economy on the international tax system with an update in 2019 and a final report by 2020. We welcome the commence-ment of the automatic exchange of financial account information and acknowledge the strengthened criteria developed by the OECD to identify jurisdictions that have not satisfactorily implemented the tax transparency standards. Defensive measures will be considered against listed jurisdictions. All jurisdictions should sign and ratify the multilateral Convention on Mutual Administrative Assistance in Tax Matters. We continue to support enhanced tax certainty and tax capacity building in developing countries, including through the Platform for Collaboration on Tax.

. International trade and investment are important engines of growth, productivity, innovation, job creation and development. We recognize the contribution that the multilateral trading system has made to that end. The system is currently falling short of its objectives and there is room for improvement. We therefore support the necessary reform of the WTO to improve its functioning. We will review progress at our next Summit.

.  We reaffirm our strong condemnation of terrorism in all its forms and manifestations. We commit to the full implementation of The Hamburg G20 Leaders Statement on Countering Terrorism. We will step up our efforts in fighting terrorist and proliferation financing, and money laundering. We urge the digital industry to work together to fight exploitation of the internet and social media for terrorist purposes.

Next four G20 Summits will take place in Japan (2019), Saudi Arabia (2020), Italy (2021) and India (2022).

(The author is a Delhi based journalist. e-mail hblshishir @gmail.com)

Views expressed are personal.