The G20 was born out of the economic crisis, in the effort to facilitate a coordinated policy response among the world’s leading economies. What emerged in its second meeting at London, and should provide a thread for discussion among the G8 at L’Aquila, was the awareness that policy coordination is necessary since the impact of the crisis is too large for countries to deal with on an individual basis. It is also necessary to implement reforms of financial markets and institutions as well as to mitigate the impact of bailout plans and stimulus packages on neighbouring economies and trading partners.
This new briefing paper by Paola Subacchi and Eric Helleiner – published jointly by Chatham House and CIGI – draws out the G20’s unfinished agenda on reversing the tide of the current economic crisis and creating a system to anticipate future crisis. It questions what position, if any, the L’Aquila summit will take on financial and monetary reforms and urges efficient modernization of the international financial institutions.
Among its summary points, the paper notes:
- From many perspectives, the London Summit of the G20 leaders at the beginning of April 2009 was a success – and a hard act to follow. The discussion was framed around crisis resolution and the strengthening of the international financial architecture.
- Beyond any concrete achievement, the success of the London Summit is that it morphed into an ongoing process with a rolling agenda, rather than remaining a one-off event.
- Undoubtedly the Italian Presidency of the G8 has a hard task, being caught between the success of London and the decreasing relevance of the G8. But there is also scope for building a meaningful bridge between London and the G8 meeting in L’Aquila in July 2009, and continuing and strengthening the economic governance reform process.
- There is an urgent need to continue to push for progress on a number of key items that were not adequately addressed at the London Summit and where progress can be made in L’Aquila – fostering clarity for the G20 agenda for the next meeting in Pittsburgh in September 2009.
- With regard, in particular, to the reform of the International Monetary Fund, the Italian Presidency should use its G8 chair to initiate a dialogue on reform of the European representation, taking advantage of having all the key players gathered together in L’Aquila.
Disclaimer: This blog is solely intended to spur discussion, while the opinions expressed are those of the author(s) and do not necessarily reflect the views of CIGI, Chatham House or their respective Boards of Directors.