Big responsibilities. The finance ministers of the G20 countries and the governors of central banks are meeting for two days in Indonesia to decide on the main global economic orientations for the coming months. “The actions we take will have a very significant effect on all the nations of the world,” said Sri Mulyani Indrawati, Indonesia’s finance minister, at the opening of this G20 summit, dominated by the repercussions of the Russian invasion of Ukraine.
Indeed, the food and energy crises linked to the ongoing war are now at the top of the priorities. In the event of failure to agree, “the humanitarian consequences for many low-income countries would be catastrophic”, warned the Indonesian minister. “This context creates risks for poor and emerging countries, linked to the normalization of monetary policies and the risks of credit contraction,” a source from the French Ministry of Finance said before the meeting.
The presence of Russia divides Westerners and large developing countries
“We are seeing fallout from this war in all corners of the world, especially in energy prices and rising food insecurity,” US Treasury Secretary Janet Yellen noted the day before, noting that “the representatives of the Putin regime should have no place in this forum”. Russian Finance Minister Anton Silouanov is due to attend the meeting virtually, while his Ukrainian counterpart Sergei Marchenko has also been invited to speak via the Internet.
The talks are expected to reflect a fault line between Westerners who want to isolate Moscow economically and major developing countries opposed to sanctions on Russia, with China in a key position. Indonesia, host country of the G20 this year, wanted to remain neutral and did not give in to Western pressure to keep Russia out of the meetings.
The major fundraisers must discuss solutions to alleviate the impact of inflation and the food and energy crises on the most fragile countries. Financial inclusion and global tax reform should also be on the menu.