As the US-China trade war rages, and fears of a new conflict in the Gulf loom, world leaders meet in Osaka (June 28-29) at the G20 Summit. Beyond today's crises, the Summit will be a litmus test for the G20 countries’ ability to tackle key global challenges: from financial stability to climate change, from trade protectionism to aging populations and the future of work in the digital age. Will the sense of urgency prevail over growing divisions?
As the world’s premier forum on international economic governance, the G20 plays an important role in global rule-making. Born out of crisis, the G20 has morphed into the inner sanctum of world governance. Given that Africa has been a rule-taker since its decolonisation, its limited participation in this grouping (only South Africa is a full member) runs the risk of perpetuating this situation.
Major technological transformations such as artificial intelligence, big data, FinTech, the Internet of Things and Industry 4.0 are putting the global economy on a new track. These innovations will bring immense economic opportunities as well as dramatic changes in industries, employment and required skills that will create major challenges for individuals, businesses and governments.
The implications of aging societies have been rising on advanced economy agendas for a long time. The challenges posed by a shrinking labor force, potential declines in productivity and a growing number of retirees which, in turn, threaten the sustainability of pension systems and public finance in general are cases in point. In the recent past, several middle- and low-income countries have also been increasingly exposed to the aging of their populations.
During the Think 20 (T20) hosted by Japan in 2019 to prepare analyses and policy proposals for the G20, a specific working group of think tank experts (Task Force n.2: TF2) devoted its discussions and proposals to the issue of the adequacy of the International Financial Architecture. This has always been a traditional and central theme of the G20. The guiding idea of this Task Force has been to concentrate its analyses and advice on the most urgent and novel aspects and problems that mark the evolution of global financial markets and institutions.
After turning 10 in the Southern Cone and celebrating anniversary in Buenos Aires, G20 started its second decade of life in Osaka. The G20 was born to deal with the economic crisis and succeeded in the challenge. It was successful in handling the global financial crisis of 2008–2009 and containing its aftershocks. However, despite the importance of today’s global challenges, the world does not seem to perceive them with the same sense of urgency.
International trade is facing many risks, according to the WTO trade forecast of September 2018. Among these are rising trade tensions and global protectionism, as well as increased financial volatility as developed economies tighten their monetary policy. Consequently, the WTO downgraded world merchandise trade growth to 3.9% (2018) and 3.7% (2019) respectively.
At the end of their G20 Osaka Summit on June 29, 2019, the most powerful leaders of the world’s most powerful countries will release a communiqué containing many commitments to respond to the biggest challenges of today’s complex world. But their citizens, increasingly skeptical of the work of such governing elites, will doubt that these commitments will make any difference to their daily lives.
The Special Strategic Partnership between Canberra and Tokyo was established as a vehicle through which these countries coordinate their regional security cooperation. According to the annual Foreign and Defence Minister’s meeting Joint Statement it is “founded on common strategic interests and shared values including a commitment to democracy, human rights, free trade and the rules-based international order”.
The pledge to have a “partnership for peace” has fast emerged as a key threshold in India-Japan security relations in recent years. Under the rubric of promoting a “free, open and prosperous Indo-Pacific” region, a new assurance of engagement seems to be unfolding with frequent bilateral naval exercises, including dialogues and training between the Coast Guards of the two sides.