The Best Policy is Economic Policy

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ST. PETERSBURG, Russia- When the Group of Twenty Nations (G20) met in St. Petersburg this past September, the news that filtered out seemed focused on Syria and spying.

The U.S. came under some scrutiny for NSA spying and, afterwards, Russia was heavily criticized for handing out flash-drives with spying software in them. Syria was a topic of discussion because Assad had recently carried out a chemical weapon attack and the US was poised to respond with military force, hoping to gain support for action. Politics, though, is not the premise of the G20 or the summits as discussion and collaboration on economic policies was the original intent.

Nevertheless, the group released a joint statement on the Syrian crisis that condemned the sarin gas attacks and pledged support to refugees from the conflict. The statement had strong words to say initially, “we call for a strong international response to this grave violation of the world’s rules and conscience that will send a clear message that this kind of atrocity can never be repeated. Those who perpetrated these crimes must be held accountable.” In the same statement, after criticizing the UN Security Council for being “paralyzed”, the G20 leaders said they are “comitt[ed]to seek[ing]a peaceful political settlement.”

Double-talk like this should not be surprising from such a large gaggle of politicians, but the discussions about Syria that took place there, especially between the U.S. and Russia, were likely fruitful. Swift action was taken to confiscate and disarm Assad’s chemical weapon stores with the support of Russia, who had been blocking UN resolutions on Syria to that point. Contributions to the UN to combat the Syrian refugee crisis also increased.

Concrete progress was certainly made against damaging economic policy. Volatile flows of capitol produced from extremely low interest rates in wealthy borrowing nations stymie the sustainability of growth for emerging economies. Such resources are fleeting, and, while they increase trade in the short term, they leave developing countries in vacuums of debt in the long term. The U.S. and Japan took criticism for these policies that devalue the currencies of smaller economies.

Stamping out corruption was also a focus, and the G20 reported 13 members have been though the anti-corruption review process and many are openly complying with recommendations that will reduce bribery and money laundering and increase transparency in general. The measures will also seek to reduce drug trafficking and prosecute officials guilty of corruption.

Another highlight was a consensus to tax transnational companies in the country they produce the income. This will be a big boost for many developing countries, particularly Africa, where companies shelter profits. Creating protection and support for emerging economies proved important to G20 delegates as they acknowledged data that showed tightening and depreciation for many such economies despite gains by wealthy nations.

Results on these policy changes and others designed to strengthen the global economy can benefit all nations as long as they remain collaborative and their successes will be how the G20 summits truly prove their worth.

– Tyson Watkins

Sources: Inter Press Service News Agency, G20 Information Centre, The Guardian, IMF, BBC, Centre for International Governance Innovation, European Council
Photo: Reuters

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