The Group of Twenty, approved on Monday (18) the final document with the consensus for this year’s mandate.
At the head of the G20, he had three priorities:
- Social inclusion and combating hunger and poverty;
- Sustainable development, energy transitions and climate action;
- Reform of global governance institutions.
The third agenda aims to make decisions taken by international organizations more inclusive and comprehensive, also embracing the realities and demands of poor and emerging countries.
In addition to bodies of the United Nations (UN), such as the Security Council; .
“We will accelerate the reform of the international financial architecture so that it can face the urgent challenge of sustainable development, climate change and efforts to eradicate poverty”, highlighted the .
What is the international financial system?
This debate revolves around restructuring the rules behind the means of payment and global debt. In the case of the G20, the agenda was integrated with other discussions since countries depend on these international financing mechanisms to finance the fight against poverty, hunger and climate change.
However, the main problem linked to , given the rigid regulation since its consolidation after the Second World War.
Amid the devastation caused by the conflict and the aftermath of the 1929 Crisis, economists from 44 countries met in 1944 for the United Nations Monetary and Financial Conference, whose objective was to design the format of the new financial system.
Known as the Bretton Woods Agreements, the decisions arising from this meeting were the bases that defined the dollar as an international standard, in addition to being the birthplace of the International Monetary Fund (IMF) and the International Bank for Reconstruction and Development (IBRD), the embryo of the World Bank.
More open and inclusive
“We reaffirm our commitment to promoting an open, resilient, inclusive and stable financial system that supports economic growth and is based on the full, timely and consistent implementation of agreed international standards, supported by continuous political coordination”, reinforces the G20.
The statement recognizes that the IMF, the leading global lender, is taking “relevant steps to adapt to evolving circumstances.”
Among the work carried out by the Fund, the statement highlights the review of charges and surcharges and the review of facilities and financing from the Poverty Reduction and Growth Trust Fund (PRGT).
“We reaffirm our commitment to a strong, quota-based and adequately resourced IMF at the center of the global financial safety net. We recognize the urgency and importance of realigning dues to better reflect the relative positions of members in the world economy, while protecting the dues of poorer members.”
However, he emphasizes that “ambitious, timely and structural” actions are still needed to “accelerate and expand climate action, in synergy with sustainable development priorities and efforts to eradicate poverty and hunger”.
Paths presented
The G20 says it sees “good prospects for a smooth landing for the global economy”, but emphasizes that .
Among the concerns presented are global growth that has been uneven, and the prospects that growth for the coming years are below historical averages.
The world’s largest economies reinforce that the restructuring of the financial system is necessary for .
“We re-emphasize the importance of addressing debt vulnerabilities in low- and middle-income countries in an effective, comprehensive and systematic way. We welcome the progress made in addressing debt under the G20 Common Framework and beyond,” the group wrote in the statement.
“We emphasize the need to increase the representation and voice of developing countries in decision-making in MDBs (multilateral development banks) and other international economic and financial institutions, to make institutions more effective, trustworthy, accountable and legitimate. In this context, we welcome the creation of a 25th seat on the Executive Board of the International Monetary Fund (IMF) to strengthen the voice and representation of Sub-Saharan Africa”, he concludes.
in promoting the economic and social development of countries seeking assistance. In this way, the statement established a “G20 Roadmap for Better, Bigger and More Effective Multilateral Development Banks”.
The group’s playbook “presents comprehensive recommendations and actions for MDBs to develop their visions, incentive structures, operational approaches and financial capabilities so that they are better equipped to maximize their impact in addressing a wide range of global and regional challenges , while accelerating progress towards the SDGs [Objetivos de Desenvolvimento Sustentável]”.
But beyond looking at financing structures, the G20 reinforced the importance of .
“Our fiscal policies will ensure fiscal sustainability and rebuild reserves, remaining supportive of growth and catalyzing public and private investments in reforms that increase productivity,” the document states.
“We applaud recent domestic tax reforms undertaken by several G20 members to tackle inequalities and promote fairer and more progressive tax systems and recognize that improving domestic resource mobilization is important to support the SDGs.”
