Last week the G20 met in Hamburg, Germany, to discuss not only the challenges but also to outline strategies to address them. The summit was tainted by violent protests, approximately 1,500 black-clad attacked shops and burned cars.
Despite the demonstrations, Angela Merkel succeeded to advance the goals she had established for the meeting. In the document “G20 Leader’s Declaration: shaping an interconnected world” made available after the event, global leaders agreed to boost international economic and financial cooperation. They also managed to put into text that the Member States consider foreign investment and trade important tools for economic growth.
The text stresses the efforts made by the attendees to cope with excess capacities. This topic is the latest challenge of globalization, once overproduction of certain goods tends to lead to market-distorting subsidies. A practice that affects companies in different geographic areas, the case of Chinese steel goods is a striking one.
The leaders expressed their will to create more sustainable global supply chains, enforcing labor, social and environmental standards established by the United Nations System, especially the International Labour Organization(ILO).
With regards to access to technologies, the G20 announced efforts to connect all citizens across the world by 2025. This will require them to provide low-income countries with the infrastructure deemed necessary. This is a precondition to job creation, once most new opportunities will be available in the tech sector. Besides, old economy positions will equally require some sort of digital skills.
Concerning the global financial system, policymakers stated their wish to make it more open and resilient than it is today. In order to accomplish such goal, they will need to conclude the Basel III talks. So far the US and Europe disagree on capital requirements that banks should have in-house to comply with regulations that aim at addressing the system’s vulnerabilities.
Perhaps the main takeaway of this summit is climate change. The tenant of the White House kept his stance on the Paris Climate Agreement. It will look for greenhouse reductions without imposing policies that could be harmful to old economy industries and job creation. By choosing this path the Trump administration is actually hampering the spread of green technologies in American soil. Soon European and Asian companies shall have enterprises leading the sector. The G20 (or G19 when it comes to climate change), however, expressed that the Paris Agreement, signed in 2015, is irreversible.
The document also highlighted goals to be attained with regards to women empowerment, food security, refugee crises, corruption and partnerships with African nations.
The summit was also marked by the first meeting between Donald Trump and Vladimir Putin. According to the New Times, the two presidents discussed the allegations of Russian cyber attacks during American elections. Mr. Trump stated to be satisfied with the answers. A stance that displeases many policymakers in Washington.
As they got along, both countries should be able to work together in other spheres, notably the Syrian conflict.