This year's G-20 summit was dominated by the G-7, a group of the world's richest nations. They were challenged only by the ambitions of the Chinese dragon.
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The 13th G-20 summit in Buenos Aires, Argentina, seems to have been a success. Success was achieved by saying that this time all the countries agreed to issue a joint statement. Earlier, a joint statement was issued by the US and China at the Asia-Pacific Economic Cooperation (APEC) summit in Papua New Guinea in October. Similarly, at the G-7 summit in June, US President Donald Trump withdrew his signature on the joint statement. Overall, this year's G-20 summit was dominated by the G-7, one of the richest countries in the world. They were challenged only by the ambitions of the Chinese dragon.
This G-20 group emerged from the G-7 group in 1999. Yet the G-20 is still a club of rich countries. Half of the member countries are advanced (US, UK, Japan, France, Canada, Australia, Germany, Russia, Italy and EU), while the other half are member countries (China, Indonesia, Turkey, Brazil, India, South Korea, Argentina, South Africa, Saudi Arabia and Mexico) are the fastest growing economies. The first G-20 summit was held ten years ago. At that time, the main issue was to consider measures to overcome the economic crisis that plagued the entire world. The key issue this year was the sustainable development of agriculture and infrastructure that will be useful in the future.
If there is one word that matters most at this meeting, it is that of US President Donald Trump. In fact, it is not possible to say when any of their roles will change. The summit's joint statement also echoed Trump's call for a restructuring of the World Trade Organization (WTO) and world trade. In a sense, this statement is not very effective. This is because the statement does not even mention the wall that rich countries have built to keep their markets safe. At least in the meeting of BRICS member countries, this issue was given special importance.
The meeting, which took place at a dinner party between Chinese President Xi Jinping and Donald Trump on December 1, caught everyone's attention. In it, Trump agreed that the US-imposed bilateral trade tariff, which would take effect in January, would be withdrawn for 90 days. China agreed that it would import agricultural and industrial products from the United States to bridge the trade gap between the two countries. The next round of talks will now be held in Washington. As a result, the trade war between the two world trade giants cooled down for at least three months.
The Trump administration has announced a 10 to 25 percent increase in taxes on $ 250 billion worth of goods imported from China from January. It also threatened to impose more taxes to curb another $267 billion worth of Chinese imports. This would have affected China's total exports to the United States. But this has been postponed for some time now.
The trade war between the US and China does not appear to have changed China's economic policies. But it has certainly widened the gap in US trade with China over the past few months. There is no denying the fact that this has slowed down China's industrial development.
The trade war also affected key sectors such as rail freight, commercial investment of banks and use of electricity. The growth rate in these sectors has come down from 11 per cent to 9 per cent. As soon as the US increased tariffs on soybean exports to China, it hit American farmers hard. US stock markets and crude oil prices have also fallen on fears that China will now reduce imports from the US.
Another important issue at the G20 meeting was the restructuring of the World Trade Organization (WTO). The participating countries agreed that the major economic powers, which control 85% of the world's economic output, should be exchanged in world trade and that there should be international policy for this. But the issue came up at the urging of the US. Therefore, for the first time, the joint statement of the summit criticized the working of the World Trade Organization. It says the WTO is failing to meet its original purpose. That is why it needs to be restructured.
The statement also said, "Given the rapidly changing global situation, we need to build a capable system that can deal with it effectively." To that end, we are all committed to developing WTO policies in line with international economic policy. " In this context, the United States raised the issue of international economic policy not being compatible with today's world economy. This is because China always takes advantage of unfair trade policies and still has not been able to impose sanctions on others.
Of course, restructuring the WTO is not an easy task for the G20. Because of the International Financial Architecture (IMF) quota system in the International Monetary Fund (IMF), developed countries get a bigger share (63%) than other countries.
The G20 countries have not yet succeeded in reforming it. Under this system, the lower the quota, the lower the chances of getting a monetary loan. Today, the US has an IMF quota of 17.7 per cent, China 6 per cent and India only 2.75 per cent.
When the G-20 group was formed, all these 20 countries were bound by different centers of power. It is true that this group came forward with the objective of global balance of power, but the current situation is different. All over the world, there are leaders who are riding the wave of popularity and concentrating their power in their own hands.
The presence of Saudi Prince Salman bin Mohammed at this year's summit was controversial. The Saudi delegation was the first to arrive in Buenos Aires with six aircraft. The murder of journalist Jamal Khashoggi at the Saudi embassy in Istanbul is still fresh. However, he was met by Russian President Vladimir Putin and his Prime Minister Modi. It is understandable that the issues of fuel supply to India from Saudi and investment in India will be behind Modi's visit.
When Modi held joint talks with Japanese President Shinzo Abe and US President Trump, Modi insisted that all countries should make a concerted effort to trap economic criminals like Vijay Mallya and Nirav Modi, who fled India. The three leaders also had a successful discussion on the issue of what policy should be adopted by the three leaders to come together and support China's trade policies. Hence the equation JAI (Japan, USA and India). Narendra Modi had another three-party discussion with Russian President Vladimir Putin and Chinese President Xi Jinping. All three insisted on mutual cooperation. Therefore, there is hope that the diplomatic relations between India and China will go further.
However, Argentina, which is hosting the G-20 summit, has been hit hard financially. Because the country is still struggling with high inflation. As a result, Argentina's government spending has been slashed. Rising US interest rates and a surge in foreign investment in key projects in the country have weakened the Argentine peso against the US dollar. And as a result, Argentina has to borrow 50 50 billion from the International Monetary Fund (IMF) to pay off its debt in dollars.
Will this parade of spectacles of the G20 summit really find answers to global problems? A rich country like America will not be particularly affected by such an event. Trump himself brought a fleet of ten planes to the summit. It was accompanied by an American warship, three reconnaissance aircraft and three in-air refueling aircraft to patrol the entire Buenos Aires area. The US Department of Homeland Security has taken responsibility for emergency cyber security.
So for the Argentine president, the summit was a one-star exercise. This is because some bad things happened earlier in the day at the G20 summit in Hamburg. That's why Argentine President Mauricio Marie had to deploy 20,000 security guards to secure the summit. The local administration had asked all residents around Buenos Aires to take time off during this period. But many refused to go because of the question of their livelihood. In spite of all this, Mary was able to carry out this event without facing any local violence, protests, etc., no less.
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