There are growing expectations on the G20 Summit in Rome, which is now at the starting line. The key question is: how to escape the fate of a G20 Summit which is a little more than a “photo opportunity” among world leaders (all the more so as some of them - such as Putin and Xi – are missing)? To begin with, it is worth noting that the Summit is just the tip of the G20 “iceberg”: it is the culmination of a year-long multilateral effort which included 19 thematic working groups as well as 13 Ministerial meetings in 2021.
So, the best way to proceed is to evaluate if and to what extent the Italian G20 has already delivered on key policy areas and global issues revolving around the “3Ps” – People, Planet and Prosperity - and see what remains to be done. In so doing, I will also take into consideration the work of the Think20 (T20), the official engagement group of the G20 which brings together hundreds of think tanks worldwide to provide policy recommendations to the G20 leaders. This also includes those global issues on which results have been achieved only partially, or not at all.
In the midst of a pandemic, it goes without saying that the first priority is People. So far, almost 5 million people died from coronavirus: vaccines are now available, but their production and distribution has been too slow and unequal. The pandemic left us with 124 million new poor, 33 million newly unemployed, and almost 500 million students at risk of being left out of education. The G20 committed to vaccinate at least 40% of the world’s population by 2021, strengthen social safety nets to mitigate poverty and unemployment, and recover the ground lost on education by filling, among other issues, the digital infrastructure gap in poorer countries. Obviously, more – and more quickly - should be done. And the T20 strived to offer a meaningful contribution to better address these challenges. For instance, on global health we proposed the G20 to establish a “Global Health Equity Observatory” to collect cross-country data to address inequalities in the provision of health care. When it comes to poverty and unemployment, we proposed the introduction of a global citizens’ income – something which might seem too ambitious at first but that is actually based on solid and feasible roots. We also focused on enhancing job opportunities for disadvantaged groups, particularly women entrepreneurs and youth, and drew attention to the importance of regulating remote working. Finally, improving access to education is crucial to recover the ground lost during the pandemic, through better monitoring and evaluation of school programmes, and by filling the digital gap.
If global health is the most burning short-term challenge, climate changeand the future of our planet are definitely the biggest long-term issues of our time. Global warming is not “fake news” but is already with us, as the higher frequency of extreme weather events (which increased five-fold over the last 50 years) clearly shows. In its Energy and Environment ministerial meeting in July, the G20 tried hard to move beyond the legacy of past Presidencies and to raise the bar of the ambition: for instance by acknowledging that the impact of climate change will be much smaller if the increase of global temperature is containedwithin 1.5° C rather than within 2° C., or by re-committing to mobilize $100 billion per year until 2025 to assist developing countries in adopting mitigation and adaptation measures. Moreover, at the G20’s behest, the IMF approved an unprecedented 650 billion SDR emission, which also aims to support green transition in developing countries; while a Sustainable Finance Working Group has been established, thus bringing Finance Ministers in (instead of solely experts and civil servants as it once used to be).
However, a key agreement on phasing-out coal and related subsidies has not been achieved yet. While urging G20 leaders to find a compromise on these points, the T20 shared a number of recommendations on “Planet”: for instance, emerging countries should be provided with the appropriate funds to face the transition: this is why a common international taxonomy to facilitate green investments should be set. We also proposed to establish a Commission to offer capacity building for workers adversely affected by climate transformation and the energy transition. We also placed a spotlight on agriculture to make our food systems more resilient and to empower small farmers.
The last – but definitely not least - “P” is Prosperity. The global economy is quickly bouncing back to pre-crisis levels (+5.9% in 2021 according to the latest IMF’s World Economic Outlook), but there are several risks around the corner: rising public debt – both in advanced and emerging economies, peaking at 100% of world GDP – might trigger a new financial crisis; a stall in multilateral trade negotiations could hamper free and fair trade flows; while an uneven digital transition could exacerbate, instead of reducing, existing inequalities. The Italian G20 delivered on some of these challenges: the agreement on a global minimum tax on multinational corporations and the extension of the Debt Service Suspension Initiative were key actions to level the playing field - while avoiding unfair competition - and to support the global recovery.
The T20 invited G20 leaders to go even beyond these measures. Economic recovery should be promoted by keeping expansionarymonetary and fiscal policies for an extended period and by creating a Global Liquidity Insurance Mechanism to support developing economies. The G20 should also be wary of the risk of future financial crises: innovative ways to progressively deleverage debt stocks are needed, also with a view to promoting transparency in global capital flows and fighting international corruption. On international trade, we shed light on the importance of making progress in reforming the WTO and to better regulate e-commerce. Moreover, the digital transformation needs to be tackled so that everyone can benefit from its opportunities: this is why the G20 should invest more in women’s digital training and explore innovative financing mechanisms for digital inclusion.
So, if one looks beneath the tip of the iceberg, it would be easy to agree that the G20 has delivered - at least partially - on some of today’s global challenges. The T20 did its part by advancing policy recommendations. However, we also have to be realistic and aware that our recommendations for a rekindled multilateral system are unlikely to be heard in full by policymakers in a context of growing international tensions. The journey of Italy’s G20 was long and winding. The T20 tried hard to paint a clear picture on what it takes to go the extra mile.
Paolo Magri is National Coordinator and Chair of T20 Italy and Executive Vice-President of ISPI.
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