Lessons in history for a G20 summit at a crossroads

China Plus Published: 2018-11-29 10:28:24
Share this with Close
Messenger Messenger Pinterest LinkedIn
By Wang Shanshan

As the leaders of the G20 group of major economies gather in Buenos Aires, they do so with ten years of positive experience behind them. However, after November’s APEC meeting ended with no agreed communique for the first time in the forum’s 30-year history, it’s feared this latest G20 event will turn out to be a somewhat ceremonial occasion. Expectations are low and hopes for a successful meeting are slim.

A man rides a bicycle past a banner promoting the G20 summit at the Costa Salguero Center, in Buenos Aires, Argentina, Tuesday, Nov. 27, 2018. [Photo: IC]

A man rides a bicycle past a banner promoting the G20 summit at the Costa Salguero Center, in Buenos Aires, Argentina, Tuesday, Nov. 27, 2018. [Photo: IC]

Over the past decade, the G20 summit has evolved from being a risk management “band-aid” solution, to a medium- and- long-term “Vitamin C” strategy for the world economy. However, at a time when there is supposed to be greater global economic governance, the organization seems to be on a road back to where it started, with the upcoming session’s theme billed as "Building Consensus for Fair and Sustainable Development".

True, consensus is a rarity in today’s political landscape, at a time when economic globalization is suffering setbacks and multilateralism and free trade are coming under sustained assault. Facing such strong headwinds, maybe it’s helpful to look back through history to see what has been done in the past to lift the world economy out of the doldrums.

Openness and inclusiveness are key to the G20 summit mechanism. In late 2008, after the financial tornado wiped out giants such as Lehman Brothers and tortured Wall Street, the world came to realize that the G7 formula was no longer enough to solve the world’s problems, and so other major players were invited to take a seat at the table for a concerted effort. The G20 group, consisting of Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Mexico, Republic of Korea, Russia, Saudi Arabia, South Africa, Turkey, the United Kingdom, the United States and the European Union (EU), accounts for 90% of the world’s GDP and 80% of total trade volume, and so well fits the definition of "inclusiveness". Its members have put forward actual plans and tools to make the world even more so.

G20 summits in the past few years have been, on the whole, successful. Leaders demonstrated a strong political will to rescue the global economy from the worst financial crisis in 70 years. The world came to agree that finger pointing didn’t help. In finding solutions to the economic crisis, the world agreed to overhaul the financial system, with a determination to carry out a "genuine, all-encompassing reform of the international financial system", which the media dubbed Bretton Woods II.

Swift action served to stoke the engine of the world economy to get it moving again. The United States for example strengthened its monetary and fiscal policies, reducing interest rates to a record low, while at the same time rolling out the largest ever stimulus package of 700 billion US dollars. Across the Pacific, China unveiled its own stimulus package of 4 trillion yuan, about 580 billion US dollars, aimed at reviving its economy, which in turn helped stabilize the world economy. A prompt injection of liquidity into the financial sector averted the trend of contraction, and kept the boat of the world economy afloat. The maxim remains, help others to help themselves. Since then, China has continued to contribute more than a third of world economic growth, according to the World Bank.

Cooperation was the motor to get the ship of the world economy sailing full steam ahead. The G20 summits achieved a general consensus on how to cooperate in key areas to deal with the financial crisis, improve financial regulation over the medium term to avoid similar crises in the future, and later on, to unleash growth potential and improve the resilience of the global financial system to promote sustainable growth.

Like it or not, the world is in the same boat. Squabbles on board not only devastate the parties involved but bring suffering to innocent by-standers too. Only when everybody rows in the same direction, can the boat move out of troubled waters. It has been proven that the world has the wisdom and will to right the wrongs.

Now, all eyes are on the Buenos Aires summit. The question of “Does the G20 still matter” is being posed more often. The answer must surely be yes, and even more so this year. With other multilateral mechanisms seemingly paralyzed, the G20 summit, born as a response to crisis, may be better placed to play a decisive role.

Though each member has its own mandate, the G20 Summit "is essentially about consensus-building, establishing a workable middle way that can oil the wheels of the world's crowded and complex financial and economic systems", as the Hangzhou summit in 2016 made clear. In the upcoming summit, China intends to reaffirm its commitment to opening-up and multilateralism and is willing to build broader international consensus on promoting ‘win-win’ mutually beneficial cooperation and common development.

History has taught us that multilateralism, as exemplified by the G20, can be a deal-maker, not a deal-breaker.

Related stories

Share this story on


LU Xiankun Professor LU Xiankun is Managing Director of LEDECO Geneva and Associate Partner of IDEAS Centre Geneva. He is Emeritus Professor of China Institute for WTO Studies of the University of International Business and Economics (UIBE) and Wuhan University (WHU) of China and visiting professor or senior research fellow of some other universities and think tanks in China and Europe. He also sits in management of some international business associations and companies, including as Senior Vice President of Shenzhen UEB Technology LTD., a leading e-commerce company of China. Previously, Mr. LU was senior official of Chinese Ministry of Commerce and senior diplomat posted in Europe, including in Geneva as Counsellor and Head of Division of the Permanent Mission of China to the WTO and in Brussels as Commercial Secretary of the Permanent Mission of China to the EU. Benjamin Cavender Benjamin Cavender is a Shanghai based consultant with more than 11 years of experience helping companies understand consumer behavior and develop go to market strategies for China. He is a frequent speaker on economic and consumer trends in China and is often featured on CNBC, Bloomberg, and Channel News Asia. Sara Hsu Sara Hsu is an associate professor from the State University of New York at New Paltz. She is a regular commentator on Chinese economy. Xu Qinduo Xu Qinduo is CRI's former chief correspondent to Washington DC, the United States. He works as the producer, host and commentator for TODAY, a flagship talk show on current affairs. Mr. Xu contributes regularly to English-language newspapers including Shenzhen Daily and Global Times as well as Chinese-language radio and TV services. Lin Shaowen A radio person, Mr. Lin Shaowen is strongly interested in international relations and Chinese politics. As China is quite often misunderstood in the rest of the world, he feels the need to better present the true picture of the country, the policies and meanings. So he talks a lot and is often seen debating. Then friends find a critical Lin Shaowen criticizing and criticized. George N. Tzogopoulos Dr George N. Tzogopoulos is an expert in media and politics/international relations as well as Chinese affairs. He is Senior Research Fellow at the Centre International de Européenne (CIFE) and Visiting Lecturer at the European Institute affiliated with it and is teaching international relations at the Department of Law of the Democritus University of Thrace. George is the author of two books: US Foreign Policy in the European Media: Framing the Rise and Fall of Neoconservatism (IB TAURIS) and The Greek Crisis in the Media: Stereotyping in the International Press (Ashgate) as well as the founder of chinaandgreece.com, an institutional partner of CRI Greek. David Morris David Morris is the Pacific Islands Trade and Investment Commissioner in China, a former Australian diplomat and senior political adviser. Harvey Dzodin After a distinguished career in the US government and American media Dr. Harvey Dzodin is now a Beijing-based freelance columnist for several media outlets. While living in Beijing, he has published over 200 columns with an emphasis on arts, culture and the Belt & Road initiative. He is also a sought-after speaker and advisor in China and abroad. He currently serves as Nonresident Research Fellow of the think tank Center for China and Globalization and Senior Advisor of Tsinghua University National Image Research Center specializing in city branding. Dr. Dzodin was a political appointee of President Jimmy Carter and served as lawyer to a presidential commission. Upon the nomination of the White House and the US State Department he served at the United Nations Office in Vienna, Austria. He was Director and Vice President of the ABC Television in New York for more than two decades.