| Group of Twenty Finance Ministers and Central Bank Governors | |
|---|---|
Member countries in the G-20
Members of the European Union not individually represented
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| Abbreviation | G-20 or G20 |
| Formation | 1999 2008 (Heads of State Summits) |
| Purpose/focus | Bring together systemically important industrialized and developing economies to discuss key issues in the global economy.[1] |
| Membership | |
| Current chair | France (2011)[2] |
| Staff | None[3] |
| Website | www.g20.org |
The Group of Twenty Finance Ministers and Central Bank Governors (also known as the G-20, G20, and Group of Twenty) is a group of finance ministers and central bank governors from 20 major economies: 19 countries plus the European Union, which is represented by the President of the European Council and by the European Central Bank.[3] Their heads of government or heads of state have also periodically conferred at summits since their initial meeting in 2008. Collectively, the G-20 economies account for more than 80 percent of the global gross national product (GDP),[4] 80 percent of world trade (including EU intra-trade) and two-thirds of the world population.[3] They contribute to 84.1 percent and 82.2 percent of the world's economic growth by nominal GDP and GDP (PPP) respectively from the years 2010 to 2016, according to the International Monetary Fund (IMF).
The G-20 was proposed by former Canadian Finance Minister Paul Martin[5] (later, Prime Minister) for cooperation and consultation on matters pertaining to the international financial system. It studies, reviews, and promotes discussion (among key industrial and emerging market countries) of policy issues pertaining to the promotion of international financial stability, and seeks to address issues that go beyond the responsibilities of any one organization. With the G-20 growing in stature since the 2008 Washington summit, its leaders announced on September 25, 2009, that the group will replace the G8 as the main economic council of wealthy nations.[6]
The heads of the G-20 nations met semi-annually at G-20 summits between 2008 and 2011. Following the most recent summit, which was held in Cannes in November 2011, all future G-20 summits are to be held annually.[3]
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The G-20, which superseded the G33 (which had itself superseded the G22), was foreshadowed at the Cologne Summit of the G7 in June 1999, but was only formally established at the G7 Finance Ministers' meeting on 26 September 1999. The inaugural meeting took place on 15–16 December 1999 in Berlin. In 2008, Spain and the Netherlands were included, by French invitation, in the G-20 Leaders Summit on Financial Markets and the World Economy.
In 2006 the theme of the G-20 meeting was “Building and Sustaining Prosperity”. The issues discussed included domestic reforms to achieve “sustained growth”, global energy and resource commodity markets, ‘reform’ of the World Bank and IMF, and the impact of demographic changes due to an aging population. Trevor A. Manuel, MP, Minister of Finance, South Africa, was the chairperson of the G-20 when South Africa hosted the Secretariat in 2007. Guido Mantega, Minister of Finance, Brazil, was the chairperson of the G-20 in 2008; Brazil proposed dialogue on competition in financial markets, clean energy and economic development and fiscal elements of growth and development. In a statement following a meeting of G7 finance ministers on 11 October 2008, US President George W. Bush stated that the next meeting of the G-20 would be important in finding solutions to the (then called) economic crisis of 2008. An initiative by French President Nicolas Sarkozy and British Prime Minister Gordon Brown led to a special meeting of the G-20, a G-20 Leaders Summit on Financial Markets and the World Economy, on 15 November 2008.[7]
Despite lacking any formal ability to enforce rules, the G-20's prominent membership gives it a strong input on global policy. However, there are disputes over the legitimacy of the G-20.[8]
Additionally, there had been talk and hope for better organization and power at the Seoul summit, but there was little done. Macroeconomics was discussed while development issues were ignored. Many hope that global governance can be made more inclusive by the G 20 and that their declarations can actually be seen through.[9]
The G-20 Summit was created as a response both to the financial crisis of 2007–2010 and to a growing recognition that key emerging countries were not adequately included in the core of global economic discussion and governance. The G-20 Summits of heads of state or government were held in addition to the G-20 Meetings of Finance Ministers and Central Bank Governors who continued to meet to prepare the leaders' summit and implement their decisions. After the debut summit in Washington, D.C. during 2008, G-20 leaders met twice a year in London and Pittsburgh in 2009, Toronto and Seoul in 2010.[10][11]
From 2011, when France chaired and hosted the G-20, the summits will be held only once a year.[12] Mexico will chair and host the leaders' summit in 2012.[13]
| Date | Host country | Host city | Website | |
|---|---|---|---|---|
| 1st[14] | November 2008 | United States | Washington, D.C. | |
| 2nd[14] | April 2009 | United Kingdom | London | [3] |
| 3rd[14] | September 2009 | United States | Pittsburgh | [4] |
| 4th[15] | June 2010 | Canada | Toronto | [5] |
| 5th[16] | November 2010 | South Korea | Seoul | [6] |
| 6th[17] | November 2011[18] | France | Cannes | [19] |
| 7th[13] | June 2012[20] | Mexico | Los Cabos | [21] |
| 8th[22] | 2013 | Russia | TBA | |
| 9th[22] | 2014 | Australia | TBA | |
| 10th[22] | 2015 | Turkey | TBA |
To decide which nation gets to chair the G-20 leaders' meeting for a given year, all 19 nations are assigned to one of five different groupings. Each group holds a maximum of four nations. This system has been in place since 2010, when South Korea, which is in Group 5, held the G-20 chair. France, the host of the 2011 G-20 summit, is in Group 4, and Mexico, the host of the 2012 summit, is in Group 3. In 2013, Russia, which is in Group 2, will host the G-20 leaders' summit. The table below lists the nations' groupings:[23]
| Group | Nations | Group | Nations | Group | Nations | Group | Nations | Group | Nations |
|---|---|---|---|---|---|---|---|---|---|
| Group 1 | Australia | Group 2 | India | Group 3 | Argentina | Group 4 | France | Group 5 | China |
| Canada | Russia | Brazil | Germany | Indonesia | |||||
| Saudi Arabia | South Africa | Mexico | Italy | Japan | |||||
| United States | Turkey | — | United Kingdom | South Korea |
The G-20 operates without a permanent secretariat or staff. The chair rotates annually among the members and is selected from a different regional grouping of countries. The chair is part of a revolving three-member management group of past, present and future chairs referred to as the Troika. The incumbent chair establishes a temporary secretariat for the duration of its term, which coordinates the group's work and organizes its meetings. The role of the Troika is to ensure continuity in the G-20's work and management across host years. The current chair of G-20 is France; the chair was handed over from South Korea after the November 2010 G-20 Summit.
In 2010, French President Nicolas Sarkozy proposed the establishment of a permanent G-20 secretariat, similar to the United Nations Security Council. Seoul and Paris were suggested as possible locations for its headquarters.[24] China and Brazil supported the establishment of a secretariat, while Japan and Italy expressed opposition to the proposal.[24] South Korea proposed a "cyber secretariat" as an alternative.[24]
A 2011 report released by the Asian Development Bank predicted that Asian nations such as China and India would play a more important role in the process of global economic governance reform in the future. The report stated that the rise of emerging market economies heralded a new world order, in which the G-20 would become the global economic steering committee.[25]
The report noted that Asia had led the global recovery following the late-2000s recession, and predicted that the region would have a greater presence on the global stage, shaping the G-20 agenda for balanced and sustainable growth through strengthening intraregional trade and stimulating domestic demand.[25]
As of 2011, there are 20 members of the G-20. These include, at the leaders summits, the leaders of 19 countries and of the European Union, and, at the ministerial-level meetings, the finance ministers and central bank governors of 19 countries and of the European Union. In addition, the Netherlands have taken part in the first four G-20 heads of state meetings, while Spain has participated in every meeting so far, despite not being recognized members.[3][26]
In addition to these 20 members, the following forums and institutions, as represented by their respective chief executive officers, participate in meetings of the G-20:[3]
Membership does not reflect exactly the 19 largest national economies of the world in any given year. The organization states:[1]
| “ | In a forum such as the G-20, it is particularly important for the number of countries involved to be restricted and fixed to ensure the effectiveness and continuity of its activity. There are no formal criteria for G-20 membership and the composition of the group has remained unchanged since it was established. In view of the objectives of the G-20, it was considered important that countries and regions of systemic significance for the international financial system be included. Aspects such as geographical balance and population representation also played a major part. | ” |
All 19 member nations are among the top 28 economies as measured in GDP at nominal prices in a list published by the International Monetary Fund (IMF) for 2010.[28] Not represented by membership in the G-20 are Switzerland (19), Taiwan (24), and Norway (25), even though they rank higher than some members. Spain (12), the Netherlands (16), Belgium (20), Sweden (21), Poland (22), and Austria (26) are included only as part of the EU, and not independently. When the countries' GDP is measured at purchasing power parity (PPP) rates,[29] all 19 members are among the top 25 in the world in October 2010, according to the IMF. Iran (18), Taiwan (19) and Thailand (24) are not G-20 members, while Spain (13), Poland (20) and the Netherlands (21) are only included in the EU slot. However, in a list of average GDP, calculated for the years since the group's creation (1999–2008) at both nominal and PPP rates, only Spain, the Netherlands, Taiwan, and Poland appear above any G-20 member in both lists simultaneously. Spain, being the 12th largest economy in the world and 5th in the European Union in terms of nominal GDP, is a 'permanent guest' of the organization, although the Spanish government's policy is to not request official membership.[30][31] As such, Spain has been invited and attended every G-20 heads of state summits with its own delegation, since its inception.
Typically, several countries that are not permanent members of the G-20 are extended invitations to participate in the summits. The invitees are chosen by the host country. For the 2010 summits, for example, both Canada and South Korea invited Ethiopia (chair of NEPAD), Malawi (chair of the African Union), Vietnam (chair of ASEAN), and Spain. As one of the world's 12 largest economies, Spain has been invited to every summit. Canada also invited the Netherlands (the world's 16th-largest economy), while South Korea invited Singapore. Both Canada and South Korea invited seven international organizations: the United Nations, the International Labour Organization, the World Bank, the International Monetary Fund, the Organisation for Economic Cooperation and Development, the World Trade Organization, and the Financial Stability Board.[32][33]
Although the G-20 has stated that the group's "economic weight and broad membership gives it a high degree of legitimacy and influence over the management of the global economy and financial system,"[34] its legitimacy has been challenged. With respect to the membership issue, U.S. President Barack Obama has noted the difficulty of pleasing everyone: "everybody wants the smallest possible group that includes them. So, if they're the 21st largest nation in the world, they want the G-21, and think it's highly unfair if they have been cut out."[35]
In an interview with Der Spiegel,[36] Norwegian Foreign Minister Jonas Gahr Støre called the G-20 "one of the greatest setbacks since World War II." Although Norway is the largest contributor to development programs in the World Bank and United Nations, it is not a member of the E.U. and thus not represented in the G-20 even indirectly.[36] Norway, like the other 170 nations not among the G-20, has little or no voice within the group. Støre characterized the G-20 as a "self-appointment group", arguing that it undermines the legitimacy of organizations set up in the aftermath of World War II, organizations like the IMF, World Bank and United Nations:
| “ | The G-20 is a self-appointed group. Its composition is determined by the major countries and powers. It may be more representative than the G-7 or the G-8, in which only the richest countries are represented, but it is still arbitrary. We no longer live in the 19th century, a time when the major powers met and redrew the map of the world. No one needs a new Congress of Vienna.[36] | ” |
According to Singapore's representative to the United Nations, UN members who are not G-20 members have responded to the G-20's exclusivity by either reacting with indifference, refusing to acknowledge the G-20's legitimacy, or accepting the G-20's status while hoping to "engage the G-20 as the latter continues to evolve so that our interests are taken on board."[37] Out of this latter group Singapore has taken a leading role in organizing an informal "Global Governance Group" of 28 non-G-20 countries, with the idea being that by working collectively they might channel their views into the G-20 process more effectively.[38][39] Singapore's chairing of the Global Governance Group was cited as a rationale for inviting Singapore to the November 2010 G-20 Summit in South Korea.[40]
The G-20's transparency and accountability have been questioned by critics, who call attention to the absence of a formal charter and the fact that the most important G-20 meetings are closed-door.[41] Critics propose an alternative such as an Economic Security Council within the United Nations, where members should be elected by the General Assembly based on their importance in the world economy and the contribution they are willing to provide to world economic development.[42]
The cost and extent of summit-related security is often a contentious issue in the hosting country, and G-20 summits have attracted protesters from a variety of backgrounds, including anarchists, anti-capitalists and nationalists. In 2010, the Toronto G-20 summit sparked mass protests and rioting, leading to the largest mass arrest in Canadian history.[43]
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