The G20 is institutionalizing itself as executive committee of international development policy
by Barry Herman, Graduate Program in International Affairs, The New School, 8 Nov. 2011
The Government Leaders of the Group of 20 (G20) have all gone home now, as have the invited political and institutional guests, the press corps, and the uninvited civil society demonstrators. Many commentators will say that the Summit did not produce any policy results that justify the meeting. And yet, below the surface, the G20 is succeeding in something important. It is, in effect, institutionalizing the role it gave itself as executive committee of international development policy.
That is, while the G20 efforts to manage global aggregate demand, exchange rate management and stronger regulation of the international financial sector have not worked out quite as planned, the Group is solidifying its role in directing the system of multilateral institutions. The Leaders are quite explicit about this, as paragraph 93 of the Cannes Summit Final Declaration says:
93. We reaffirm that the G20's founding spirit of bringing together the major economies on an equal footing to catalyze action is fundamental and therefore agree to put our collective political will behind OUR economic and financial agenda, and the reform and more effective working of relevant international institutions (emphasis added).
However, not only was the G20 not asked by the international community of nations to take on this role, it is not doing a good job of it. It is being selective in the issues on which it works and it looks to the private sector to come to the rescue where official cooperation (at least from traditional sources) is and will be lagging. This is most clearly seen in the activities and conclusions of the Development Working Group (DWG) that the G20 set up at the Seoul Summit last year as part of its Multi-Year Action Plan. While the G20 Final Declaration calls for the "prompt implementation of our Multi-Year Action Plan" (paragraph 70), which the DWG had closely followed in its work program, at least the Cannes Summit Final Declaration is not as unbalanced as the DWG report to the Summit; e.g., the Leaders introduced some discussion of official development assistance (albeit without meaningful commitments); made reference to innovative sources of financing for development (probably thanks to Bill Gates); made reference to environmental sustainability and the fight against climate change (alas, no progress here); and implicitly left open more of a role for the public sector in infrastructure investment (while mainly seeking ways to attract private investors). Moreover, the international social agenda seems to have been stripped down to nationally defined social protection floors for the poor in low-income countries (why not some minimal international guidelines?) and worrying about creation of decent jobs. Yes, this helps, but there is much more.
The distortion of the international agenda would be less of a concern if the 20 only agreed to undertake analyses themselves and then collectively act on them, but member governments do not seem to have agreed to any new individual policy steps. Rather, the G20 "tasks" the multilateral institutions to develop policy proposals in particular areas and then to undertake G20 decisions to implement them. However, the G20 is not the governing body of the institutions charged to carry out the work (drafters of the outcome documents are usually quite careful in how they phrase their instructions to institutions, but sometimes instead of phrases like "call on" or "request" one sees "We have tasked...," as in paragraph 14 of the Leaders Final Communiqué addressed to IOSCO, the International Organization of Securities Commissions).
Your present correspondent happened upon the work of the DWG somewhat by accident in July. As it is was not much discussed in public forums, I was moved to try to explain what G20 policies were being developed and how they compared to international policy. guidelines. The assessment I drafted is based on the report of the DWG after its September meeting (not made public), which differs from the report published in November only in that the call for only private finance to plug the infrastructure investment gap was modified to include public sources, albeit adding a mention of private-initiated infrastructure investment, which seems a curiosity); in addition, a trade paragraph in brackets was accepted in full in the final text of the report.
For the interested reader, this paper, "G20: Wrong International Forum for Development" is posted on this web site of the new international analytical NGO based in Germany, Social Justice in Global Development (www.socdevjustice.org). The paper is a somewhat detailed assessment (for which I apologize) of the topics addressed by the DWG, namely: infrastructure investment; International trade; private investment, job creation and skills; agricultural production, food security and humanitarian needs; domestic resource mobilization (i.e., taxes); social protection of vulnerable populations; remittance transfers and other issues.