- China is assuming the presidency of the G20 in 2016, at a time when the global economy is facing significant challenges: economic growth is continuing to slow, a number of emerging markets are in recession, commodity producers are experiencing severe difficulties and downside risks are increasing.
- The G20 has a critical part to play in addressing these problems. China, as G20 president, will bear a significant responsibility for ensuring action is taken. However, its economic size, development experience, foreign exchange reserves and expertise in infrastructure should stand it in good stead to carry out this role effectively.
- President Xi Jinping has said that China’s priorities will be: boosting potential growth, improving global governance, promoting international trade and investment, and implementing the UN’s 2030 development agenda.
- In developing concrete actions for the G20 to endorse, China should focus on three main areas: boosting global economic growth, supporting sustainable development and promoting equity.
- To boost global growth, the G20 needs to implement fully the actions agreed at the Brisbane summit. But they need to go further through support for infrastructure and deep structural reforms. They also need to reinvigorate the trade agenda and the institutions supporting it, in particular the WTO. In addition, the Multilateral Development Banks need to focus more on supporting growth.
- The G20 also has an important role to play in backing the UN’s sustainable development agenda. Infrastructure and energy are key components.
- As well as closing the gap between rich and poor countries, the G20 can support greater international equity in a number of respects: greater cooperation on tax reforms and anti-corruption measures; strengthened global safety nets and mechanisms to support countries in crisis; and modernizing the governance of international financial institutions. Further reform of quotas at the IMF is needed to give greater voice to emerging countries.
- It is also time to revisit the G20’s own role and structure to make it more effective, and to ensure that it drives forward wider reforms of global governance.
- This is a large and challenging agenda, but expectations are mounting that China can and will use its leadership status to ensure the G20 acts to address these issues, and demonstrate that the G20 remains the premier forum for international economic cooperation.