Nancy Alexander, guest blogger, part of our 2011 Spotlight G20 Series
As is customary now, the days of the business summit – the B20 – overlap with the Leaders’ Summit. In Cannes, the B20 is on November 2-3; the G20 is on November 3-4. At these Summits, the Presidents of the business confederations of the G20 countries, as well as 120 CEOs and Chairmen from global companies are delivering messages on 12 themes to the G20.
Many of these Ultra-High Net Worth Individuals (HNWIs) live in a rarified world according to the World Wealth Report 2011. A world far from the “99%” of the population represented by the “Occupy” protests or the civil society mobilizations in Nice on 2-3 November.
The G20 Advisory Group of the International Chamber of Commerce (ICC) is already working closely with its counterparts on the June 18-19 G20 Summit in Los Cabos, Mexico. That Summit will focus on seven themes: financial regulation and supervision; IFI, especially IMF, reform; the International Monetary System; financial inclusion; commodity price volatility and food security; green growth; and challenges for economic growth.
But whether it is the French or the Mexican G20 Summit, everyone is asking the same question: can the G20 deliver? The G20 motto seems to be “No We Cannes’t”. By listening to its own ideologues and the whispers of business, the G20 is sending more and more proposals to the graveyard, such as:
1. Macroeconomic Policy: A Middle Ground? The G20 pivoted prematurely from a position of coordinated stimulus in 2008-09 to synchronized fiscal consolidation in 2010-11. Now, given the dire straits of the global economy, the G20 needs to find some middle ground to restart growth and create jobs, while stepping up the pace of financial regulation. Yet, business whispers “no, you can’t” to the G20. (See statements to the Cannes Summit by the Global Unions and a coalition urging that human rights norms and principles guide decision-making on financial regulation and climate change.)
2. Sustainable development? The G20’s High Level Panel (HLP) on Infrastructure seeks approval by the G20 Leaders for the launch of a huge, regional, public-private partnerships (PPPs) initiative in infrastructure, including a new G20 Infrastructure Facility and eleven flagship projects. In selecting these projects, the HLP may have been asked to consider sustainability factors, such as their carbon footprint or the rights, priorities and consent of affected populations. If so, their answer was “No, we can’t.” (See: “Beyond the Public Eye” and position of International Working Group on Trade-Finance Linkages on G20 Development Agenda)
3. Financial Transactions Tax (FTT). Bill Gates is expected to present his report to G20 Leaders on new and innovative sources of finance, which supports one version of the FTT. However, since the October communiqué of the G20 finance ministers and central bankers makes no mention of the proposal, consideration of it at the Summit level will be postponed. (See Kavaljit Singh’s Why We Need a Financial Transaction Tax: A Proposal for the G20.)
4. Biofuels and Food sovereignty? The G20 Finance Ministers commissioned research on biofuels from ten international institutions, which concluded that that the diversion of food crops for use as fuel represents a permanent re-structuring of the food economy, which will exert continuing pressure on food prices in ways that will adversely affect vulnerable consumers. (Price Volatility in Food and Agricultural Markets: Policy Responses, 2011). The paper called upon the G20 to eliminate government mandates and subsidies that have spurred the production and consumption of biofuels. But with business whispering in their ears, the G20 Agriculture and Finance Ministers, said “No, we can’t.”
5. Anticorruption? The G20’s Anti-Corruption Progress Report will be published at the Cannes Summit. The G20 points to the new laws in Russia, China, India and Indonesia criminalising foreign bribery as one of their successes. But, for the first time, Transparency International’s annual Progress Report on the enforcement of the OECD Convention Against Bribery of Foreign Public Officials indicated no progress in enforcement made by signatories to the Convention in comparison to 2010.
Progress is being made on some fronts (e.g., transparency of extractive industries active), but on the whole, in taking business as its exclusive partner, the G20 is narrowing the policy agenda in ways that do damage to the public interest. As citizen pressure grows, the G20 will feel pressure to become transparent, consultative and accountable in relation to member and non-member countries as well as to legislatures and citizens. However, until that happens, business and the G20 will have the last word, “No, we can’t.”
Nancy Alexander is the Director of the Economic Governance Program at the Heinrich Boell Foundation-No. America.