Under the Greek question mark
Depending on the outcome of the elections in Greece (the elections may determine whether the country will remain in the euro zone, or leave it with the likelihood of a domino effect), the G-20 leaders may have to assume the role of a fire brigade and urgently develop a new rescue plan for the euro zone.
The upcoming G-20 Summit, which will be held in Los Cabos, Mexico, will take place under a very difficult background – the continuing euro zone sovereign debt crisis and the recession of developed economies, expectation of a new wave of global economic crisis and the situation in Syria. The growing differences between the major players in the G-20, as well as within the EU on how to overcome the crisis (as demonstrated especially by the recent G-8 summit on the issues of reducing government spending or on measures to stimulate economic growth) pose a challenge to the host leader.
The agenda of the summit, declared by Mexico – the G-20 host country – is quite ambitious: economic stability and structural reform of the global economy; strengthening of financial systems and improving the global financial and economic architecture in the context of globalization, food security, sustainable development, energy efficiency, green growth and climate change.
According to Mexican President Felipe Calderon, the summit aims at coming up with an action plan to tackle the crisis (like the action plan to support global economic growth and employment, adopted at the Cannes summit in 2011, whose implementation leaves much to be desired). The plan will not only include short-term measures to confront and resolve the situation in the euro area, but also long-term measures on tax, finance and monetary policy which will help boost global economic growth.
Despite the declarations by the host country, it is likely that the dominance of the issue of Europe's rescue will leave the G-20 leaders with little time to make decisions on a number of key issues, that are of paramount importance both for the G-20 countries and for the rest of the world: food security, new sources of financing for development, green growth, and climate change.
Depending on the outcome of the elections in Greece (the elections may determine whether the country will remain in the euro zone, or leave it with the likelihood of a domino effect), the G-20 leaders may have to assume the role of a fire brigade and urgently develop a new rescue plan for the euro zone. Thus, Mexico faces a difficult task of aligning the summit agenda so that the negotiations are not reduced to only discussing the Greek question. In turn, the elections in Mexico itself, which will take place shortly after the summit, have left no time for Mexico to bargain for a strong position on a number of issues.
The summit in Los Cabos is preceded by the largest UN Conference on Sustainable Development in Rio de Janeiro (Rio +20), which will take place twenty years after the Earth Summit of 1992, when the Agenda for the XXI Century was adopted. Because the topics of the events overlap, it is important that the G-20 leaders do not limit themselves to ritual statements to support the conference, but to set the vectors of the concept of green growth, which was first formulated during the G-20 Summit in Seoul in 2010.
The issue of food security is one of the key topics in all major forums in recent years. In 2011, the G-20 countries adopted an Action Plan on food price volatility and agriculture, which attaches great importance to increase in productivity, protection of the vulnerable segment of the population against the negative effects of rising food prices, coordination of national efforts to overcome food crisis, and establishment of food reserves. It is important that the topic of food security remains at the centre of attention at the summit in Mexico, especially since global food prices remain volatile despite efforts by the international community.
Russia takes over the presidency
The summit in Los Cabos acquires more importance for Russia due to its presidency of the G-20 in 2013. Thus, Russia is for three years included in the part of the so-called "Troika" (past, present and future chairs) – a mechanism formalized at the Cannes summit , and providing additional opportunities for the three countries to coordinate the agenda on major issues. Russia's membership in the Troika can enable it exert more influence on the agenda of the current summit, and – acting in alliance with its BRICS colleagues – can more actively promote its position. In 2014, Russia will also preside over the G-8 and BRICS, which gives additional possibilities for the harmonization of the agenda of these platforms and strengthening of Russia's position on many issues.
At the summit in Los Cabos, there will be a series of bilateral negotiations, including the meeting between Russian President Vladimir Putin and U.S. President Barack Obama. It is expected the two leaders will adopt a joint declaration on cooperation between the countries, in particular on the possible expansion of fields of activities of the joint Russian-US Commission, which currently has 20 working groups. The Iran and Syria issues will also be discussed. Consultations within the BRICS will also be held in order to "compare notes" and clarify the overall position on some issues (especially on the quota of votes and contributions to the IMF).
The future of the G-20
In connection with the decisive weight of the G-20 countries in the global economy, the G-20 in recent years has become a major (though not the only) mechanism for international economic cooperation and global governance, which, under the global economic crisis, imposes on it the burden of responsibility for ensuring sustainable economic growth in the world. The topics of the G-20 summits continue to expand and become more complex (and, apparently, this process will go further – in particular, the issues of international development assistance, green growth, and energy security are gradually occupying an increasingly prominent place on the agenda), while the issue of setting priorities and formulating achievable goals is becoming particularly sharp. The diverse composition of the G-20 hinders coordination of the overall agenda, and the decisions made are often vague. Recently, experts have been raising questions not only about the effectiveness of implementing the decisions of the G-20 summits, but also about the legitimacy and representativeness of the forum (for example, the entire African continent is represented only by South Africa). The level of fulfilment of the obligation of the G-20 is still lower than that of the G-8, while the complex nature of the obligations and the defective system of reporting makes it difficult to analyze the efficiency of implementing the decisions adopted by G-20.
The necessary way of improving the efficiency of both the activities of the forum and the implementation of the decisions adopted by G-20 is to improve the openness of the process of discussion and involvement of a wide range of stakeholders in the discourse. The first steps in this direction are already being made: a distinctive feature of the Mexican presidency in the G-20 is involvement in the consultation process of a wide range of stakeholders both within the country and in other member states: business, the youth, civil society, trade unions, research organizations (Mexico continued the trend set at last year's summit in Cannes). These measures will enable the issues of interest and concern within society to be presented for discussion at the summit.
In recent years, we have been seeing a change in the balance of forces within the G-20. The position of "new donors" (primarily the BRICS countries), whose voice is louder, particularly on the reform of international financial institutions (the so-called Bretton Woods system) is strengthening in the forum created at the initiative of seven developed countries. In this situation, Russia (as one of the "new donors" and active member of BRICS), is acquiring an additional advantage, since it can present a united front with our partners on the block. On the other hand, the motley composition of member countries makes it essentially difficult to work out a common position in almost any direction.
Despite the criticisms, the G-20 has in general proven its effectiveness as a global financial regulator. However, the problem of global fiscal and trade imbalances is rooted in the economies of developed countries and lies on the plane of their sovereignty and political interests, which does not allow the G-20 countries to come to an agreement on many fronts.
Judging by the trends of recent years, G-20 summits focus on discussing "hot" topics (such as the sovereign debt of Greece), while long-term issues of economic development do not receive proper consideration. For example, at the summit in Pittsburgh in 2009, the Framework for Strong, Sustainable and Balanced growth was adopted, but this process did not receive specific development. The G-20 should develop and ensure the practical implementation of an overall plan of achieving global economic growth, which would include issues of reducing global imbalances of economic development, poverty alleviation, food security and climate change. It is hoped that the summit in Los Cabos will provide the necessary impulse to this process, which Russia will be able to further develop during its future presidency.