Economic pressures and absent group photo:Obstacles facing G20

World leaders representing the 20 largest economies will gather on Tuesday in Bali, Indonesia, within the framework of the annual meeting of heads of state of the Group of Twenty(G20).

It is expected that the global economic crises will top the discussions, while the group suffers from an internal division that limits the possibility of agreeing on solutions.

Since 2022, the group includes Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, South Korea, Japan, Mexico, Russia, Saudi Arabia, South Africa, Turkey, the United Kingdom, the United States, and the European Union.

The G20, which consists of 19 countries in addition to the European Union, constitutes about two-thirds of the world's population, 85% of global economic output, and 75% of global trade, according to the Guardian.

The meeting will be attended by heads of countries with strong economies, including US President Joe Biden, Chinese President Xi Jinping, and British Prime Minister Rishi Sunak, at a time when the summit is overshadowed by global inflation and the Russian war on Ukraine.

Russia is supposed to participate in the meeting, but its president, Vladimir Putin, will not attend personally and will be represented by his foreign minister, Sergei Lavrov.

Important meetings

US President Joe Biden met his Chinese counterpart Xi Jinping Monday in Bali on the sidelines of the summit. This is the first direct meeting between the two presidents since Biden took office.

The Washington Post report pointed out that the Biden-Xi meeting "is the most important meeting in Biden's 6-day trip," especially as it coincides with warnings from the Pentagon that "China constitutes the most comprehensive and dangerous challenge to American national security," not to mention fears of "a cold war from the United States and China".

The files that the two men are supposed to discuss are many, as Washington and Beijing are at odds over issues from trade to human rights in the Chinese region of Xinjiang, through to the status of Taiwan, according to an AFP report.

Biden said Sunday that the unexpected success of Democrats in the midterm elections has put him in a stronger position for critical talks with his Chinese counterpart, Xi Jinping.

Economic pressures

The economic problems since the outbreak of the Russian war on Ukraine and the beginning of its repercussions are still represented in the slowdown in global economic growth and the entry of economic stagnation in many countries. The rise in the prices of raw materials and food as a result of the war increased inflation levels and prompted central banks to raise interest rates and thus increased levels of indebtedness, which negatively affected poor countries whose people also suffer from high prices.

The Wall Street Journal report stated that “reducing economic pressures is currently out of the question during the G20 summit because central banks will raise interest rates in the future as well.”

In this context, Matthew Goodman, senior vice president for economics at the Center for Strategic and International Studies in Washington, said, “The G20 today is not what it was during 2008 and 2009.”

“There is no longer any agreement on common goals,” he added, according to the Washington Post report.

Any proposal regarding joint endeavors between countries is entrapped by the growing division between the US on one side and Russia and China on the other, according to the report.

The Washington Post and Wall Street Journal agreed that there are no indications that relations between Washington, Russia, and China are likely to improve.

The two newspapers indicated that Russian President Putin would remain in his country and would not personally participate in the meeting. The dispute between the US and China, the world's two largest economies, is also due to issues related to trade, technology, national security, and Taiwan, according to the Wall Street report, which considered that expectations are low for any significant improvement in relations between the two countries when Biden meets with Xi Jinping.

Meanwhile, US Treasury Secretary Janet Yellen will meet with People's Bank of China Governor Yi Zhang on the sidelines of the summit to discuss the global economic outlook, according to a Treasury official.

“The G20 is now suffering because the problems of the global economy are caused by the Russian war on Ukraine,” said IMF Managing Director KristalinaGeorgieva.

She added that “the current economic situation is different from the financial problems that pushed the world into recession during 2009.”

“It is impossible to solve a geopolitical problem by adopting economic policies,” she pointed out.

Georgieva noted that “it will be very difficult to raise the level of economic cooperation to the level it should be now because the end of the Russian war on Ukraine is the most powerful factor leading to the transformation of the global economy.”

“However, this week the White House insisted that the G20 remains effective,” the Washington Post report noted.

“Biden deeply believes in the enduring importance of the G20,” said a senior administration official who briefed reporters on the meeting and spoke on the condition of anonymity.

The Wall Street Journal reported that the International Monetary Fund expects the global economy to grow by only 2.7% during 2023. It also expects 31 out of 72 economies to record a decline in production for two consecutive quarters sometime this year and next. The IMF also expects the global economy to expand by 3.2% this year, just over half the 6% pace it achieved in 2021.

Absence of world leaders' group photo

There will be no official group photo of the world's leaders due to the great annoyance of Russia's presence at the summit.

According to Bloomberg, Indonesia is requesting a closing statement for the meeting, but it is difficult to do so because Russia refuses to describe its actions in Ukraine as an invasion.

It is noteworthy that the G20 summits often take place in conjunction with the outbreak of at least one crisis, and discussions revolve around it. Leaders occasionally challenge a particular leader, for example, what happened with Putin in 2014 after the annexation of Crimea, according to Bloomberg.