By: Peter Kim, Emily Laur, and Cirl Lee
The Group of 20 (G20), established in 1999 in response to the global financial crisis that spanned from 1997-1999, represents the premier forum for international economic cooperation and a mechanism for global economic governance by the world’s 20 largest economies (2). The member countries include Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Republic of Korea, Russia, Saudi Arabia, South Africa, Turkey, the United Kingdom, the United States, and the European Union (1). The Group is entrusted with “the critical mission of addressing economic risks and challenges, promoting world economic growth, improving global economic governance and sharing development benefits amongst people across the world” (2).
The most recent G20 Leaders’ Summit took place in Hangzhou, China on September 4th and 5th. China is the 2nd Asian country to host the G20 Leaders’ Summit since South Korea hosted in 2010. This year’s discussion held by country representatives revolved around several major topics: the integration and growth of the world economy, the promotion of innovation and the digital economy, climate change, global refuge and the migration crisis, and the promotion of sustainable development for developing and lesser developed countries.
The agreement made amongst G20 leaders this year affirmed the last consensus achieved in the 2014 Brisbane Summit whose centerpiece produced country-specific growth strategies and the Brisbane Action Plan on promoting energy efficiency (3). However, there were a number of environmental and economic improvements made between countries that strengthened the preexisting communiques. The major changes resulting from the summit were arranged around policy co-ordination, innovative economic growth, financial and economic governance, trade and investment, and development.
G20 leaders collectively agreed upon on the “Hangzhou Consensus”; the main objective of which is to bring more inclusive economic growth. The Hangzhou Consensus may bring more open trade and technical innovation in terms of macroeconomics, further reducing global corruption and international tax avoidance issues. Other progressions witnessed during the 2016 Summit included the agreement to reduce carbon dioxide emissions in accordance with the Paris Agreement recently drafted at the Conference of Parties 21 (COP21) under the United Nations Framework Convention on Climate Change (UNFCCC), validating the mandate amongst G20 leaders to secure progress in global carbon abatement and reduce the effects of climate change.
Due to irregular changes in global economics that have resulted from the growing pace of globalization, the actual outcome of the consensus may be overestimated. The Wall Street Journal pointed out that the communique made in G20 Summit contains many agreements on complex economic growth, but without substance. Thus, no concrete solution or plans for complex economic growth were codified during the summit.
Interestingly, the media coverage of the event focused primarily on the relationship between China and the United States. US Media often projected the “disrespectful” behavior of China towards President Obama emphasizing the a lack of red-carpet upon his arrival. This effectively deemphasized the main objectives and conversations taking place. Further, as the political baggage of deploying Terminal High Altitude Area Defense (THAAD) in South Korea and the disputes over the South China Sea remain unresolved between the two countries. These issues will likely continue as a point of controversy between China and the United States, causing further tension between the nations despite Obama’s increased attempts towards diplomacy with Southeast Asia during his presidential term.
In consummation, since little time has passed since the conclusion of the 2016 Summit, it is difficult to judge the summit’s success at this point in time. The agreements made on economic development and global climate change did display that the countries are reaffirming their shared goals to address these issues, yet the whimsical change in the world economy and the disagreements between China and the United States cannot be underestimated and should be discussed in the near future.
