G20 finance deputies aim for consensus and strong economic statement at Durban meeting

TimesLIVE

a day ago

G20 finance deputies are hopeful of reaching a consensus on the remaining sticking points and issuing a strong statement on the global economy as they work on finalising the first communique under South Africa's presidency.
The G20 finance and central bank deputies have convened for a two-day gathering at the Capital Zimbali in Durban, which is set to kick-start the rest of the G20 finance track meetings throughout the week.
Among the issues the deputies will be engaging on over the two days will be that of finding a collective agreement on the direction of the finance track which they will provide to the finance ministers and central bank governors.
Finding that agreement has proved elusive to the deputies in previous meetings, mainly due to their different perspectives on the global economy.
'It's these little ways in which countries have different views about narrating the problem to the global public that often is a source of tension but we are hopeful that we can get a communique now, we aim to work on it,' said SA Reserve Bank deputy governor Rashad Cassim, who co-chairs the meeting with National Treasury director-general Duncan Pieterse
Cassim stated that they have managed to make progress in areas while it has proved more difficult to make progress in others.
'The best case scenario would be a communique but if we don't have it we will have a solid shared-summary that will articulate the problems.'
He said different views around narrating issues that affect the global economy, like the ongoing conflict in Europe and Asia and climate change priorities, are the main contentious issues left to iron out in this process, though he emphasised that the finance track tries to focus on the 'big financial issues'.
'There are generally few issues about how you articulate the global economy. Countries may have differences on whether the conflicts in the Middle East, Russia and Ukraine have an impact on the economy. There will be different perspectives on how you think about that so getting consensus on how you articulate that kind of narrative is one area,' he said.
'Other areas that are highly contested (are) around the extent to which we're to deal with climate change; how much emphasis we put on climate transitions versus how much emphasis we put on climate adaptation.'
Pieterse said recent discussions on virtual platforms about drafting the communique have been generally positive in the past week.
'We really want to thank the G20 members for very constructive inputs and engagements thus far, which started last week virtually, and we believe that those engagements have set a very strong foundation for our discussions over the next two days. We are very pleased with the collaborative spirit shown during the virtual discussions, and we believe that we are able to achieve agreement in most of the areas, which will enable us to provide the finance ministers and central bank governors with an opportunity to achieve the first communique under South Africa's presidency.'
Pieterse noted that the meeting came at a time when the global economy was navigating uncertainty, marked by resilience in some areas but also significant challenges in others, including uneven growth trajectories, elevated debt levels and inflationary pressures, and implications of tightening financial conditions.
'At the same time, various long-term transitions including digitalisation, climate finance and demographic shifts are reshaping the foundations of our economies.'
Cassim shared similar sentiments, adding that these situations underscore the importance of G20 meetings.
'G20 works best when there is an economic crisis: it worked particularly well during the great financial crisis and during Covid-19 where countries collectively could agree on regulations and transfer of resources to developing countries.'
Carrim also weighed in on the potential impact of the tariff uncertainty and the global trade disruptions as a result of the tariffs imposed by the US.
'What the uncertainty does has two-sided problems. It means at a time when we need growth to be stimulated, tariff uncertainty has an effect in that it creates supply chain issues and uncertainty for inflation, though at this stage it's the tariff imposer that has to deal with the inflation more than the countries that are victims of those impositions.'
Despite those challenges, Carrim added that US delegates are present and have been actively participating in the communique process.
'Remember countries have different views and you have to find common ground. We had a troika with them. They present their views, as do others, and the discussions have been very constructive.'
Along with the first session of drafting a communique, Monday's meeting saw an update from the Council of Europe Development Bank (CEB) on the multilateral development bank's monitoring and reporting framework and a pandemic response financing simulation exercise facilitated by the World Bank.
From Tuesday, the International Monetary Fund and the World Bank give updates on the global sovereign debt round-table. The next session will see former finance minister and current chairperson of the Africa Expert Panel Trevor Manuel give updates on the work of the panel.
'We will be getting an update from minister Manuel on this so that we can ensure that we align African priorities with the global economic reform efforts that we are discussing in the G20,' said Pieterse.