Pittsburgh Message for G20

In the past very global summits have produced desired results. The just concluded G 20 summit in Pittsburgh should be one of among the failed past summits. The world leaders gathered must live up to the global expectations and sort out the pending problems like economic crisis and climate change. If this opportunity is lost then the people will also lose their faith in these kinds of summits in the future.

The Times of India writes (28 September 2009)

Move over, G-8. From now on, G-20 is the ”premier forum” for global economic cooperation. That’s the message from the Pittsburgh summit of developed and major developing nations. Cynics mock the too-many-cooks approach to economic firefighting and decision-making that they claim will result.
But others hail the change, including Prime Minister Manmohan Singh many of whose policy prescriptions appeared in the final communique. Indeed, the worst downturn since the Great Depression is reason enough to go beyond the symbolism of G-20’s elevation. Status quoists forget that the world has been executing an economic bailout demanding all hands on deck. That’s why managing a crisis triggered by Wall Street’s meltdown has seen China and India push growth vigorously, doing their bit to keep the world economy from tanking.

Thanks to their growing clout, China, India and Brazil need a prominent place in any international decision-making architecture. Given emerging economies account for around half the world’s output, only pretension can drive G-8’s claim to calling the shots.
It’s good that a levelling framework will allow G-20 countries to work together to ensure their policies promote sustainable, balanced growth. G-20 also did well to agree to shift a higher percentage of IMF’s quota share to developing countries. Since IMF will keep tabs on global economic stability, it can’t remain associated with a few rich nations.

G-20 rightly backs a rebalancing of US-China economic ties. For years now, the US has seen inflated import bills while China has ridden on trade surpluses. America pledging to reduce debt-fuelled spending and China committing to boost domestic demand isn’t just a G-2 affair. The action the two sides take will be critical for future global stability.
There was consensus as well on an issue strongly pushed by India: stimulus measures will stay for now. While G-20 can pat its back for preventing a recession from turning into a depression, it’s too early to end rescue operations. Exit strategies may be globally coordinated but, for now, countries need more than green shoots to sign on.

Multilateral consensus-building is always work in progress. Broad guidelines were adopted to raise regulatory standards for financial institutions, with the Financial Stability Board assigned to mark progress. But there was some discord on bankers’ pay and banks’ capital requirements. It’s, however, debatable whether there can be rigid global prescriptions in such matters.
There was also talk about resisting protectionism, but many nations haven’t walked this talk. Overall, the summit formally initiated the move away from an economic governance structure straddled by an elite club of rich industrialised nations. Economic diplomacy has to reflect 21st century realities, and that’s where Pittsburgh scores. The-skyline-of-downtown-P-001

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