She told the group: “Hopeful signs of recovery last year were replaced by an abrupt slowdown in the world economy because of Covid, the war in Ukraine and climate disasters on all continents.” The difficulty is that to tame inflation, the US needs to raise interest rates, but that strengthens the dollar, making the goods that poorer countries import more expensive.įor Indonesia, laying on a visually sumptuous summit, it was a relief that Vladimir Putin chose to stay away, and the Russian leader’s substitute, Lavrov, did not come into the cavernous conference room to hear the passionate televised address by Volodymyr Zelenskiy. It will be very difficult to bring the level of economic cooperation to the level it should be … Ending the war in Ukraine is the single most powerful factor to turn around the world economy.” Kristalina Georgieva, the international monetary fund managing director, agreed: “You can’t solve a problem of geopolitics with economic policy measures. It seems incredible that, when we have not yet overcome the shock caused by a pandemic, Russia unleashes a military invasion of Ukraine, putting world peace in crisis.” The Argentinian foreign minister, Santiago Cafiero, standing in for his ailing boss, put it well on Tuesday when he told colleagues: “In the northern hemisphere, the merchants of death trade lethal weapons, but in the southern hemisphere, food becomes more expensive or is lacking, and what ends up killing is not bullets or missiles, but poverty and hunger. But such distinctions are hard to maintain since the Ukraine war is a “total hybrid war” in which gas prices and the seizure of Russian central bank assets are as much a weapon of war as a high mobility artillery rocket system. Indonesia has tried to keep Ukraine off the agenda by saying the G20 is primarily an economic forum, not a geopolitical security forum.
Add in the Ukraine war, and the US-Sino tensions over Taiwan, and there is very little oxygen left.”Īlthough a communique, in preparation for months, will be produced, its focus on issues such as digital transformation, post-Covid recovery and food security is unlikely to stretch beyond the non-committal platitudes that normally fill such statements.
He said the post-Covid economic recession might have brought the world together again, “but this is not a crisis hitting every country in the same way, so there is no solution on which all sides can agree. The G20, according to Dr Tristen Naylor, an assistant professor of history at Cambridge University, “has worked best historically when there has been a galvanising crisis affecting everyone equally, especially the financial contagion in 2008”.
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