Back to basics for inclusive global growth
G20 Summit

Back to basics for inclusive global growth

Cyril Ramaphosa, President, South Africa

As we prepare up for the 14th meeting of the G20 leaders in Osaka, we should reflect on the role of this important forum in not just addressing but also resolving some of the world’s most pressing political, social and economic challenges.

We live in turbulent times. Levels of inequality both within and between countries are growing and deepening. Trade wars are looming between important actors in the global economy. Wars and conflicts continue to threaten the peace and security of millions of people, and have led to humanitarian crises in various parts of the world.

The rules-based multilateral system is being steadily eroded by, among other things, the troubling emergence of nativism and expressions of ultra-nationalism. Global debt levels are unsustainable. The impact of climate change is increasingly felt, and poses a real threat to lives and livelihoods.

Within this context, the G20 has an increasingly important role to play in contributing to global governance, stabilising the global economy and protecting the planet.

We were pleased with the outcomes of last year’s Buenos Aires leaders’ summit and particularly the focus on the Compact with Africa, illicit financial flows and early childhood development.

The success of the G20 in mitigating the impact of the 2008 global financial crisis and its measurable success in combating base erosion and profit shifting on tax are testament to the potential of the group.

The continued focus of the G20 on supporting developing countries in the implementation of the United Nations 2030 Agenda for Sustainable Development is to be commended. This needs to be scaled up, especially considering the $2.6 trillion annual financing gap that threatens the ability of countries to realise the Sustainable Development Goals.

The Osaka Summit must also address challenges for developing countries in meeting their obligations under the Paris  Agreement to combat climate change that come into effect next year.

Although climate change affects us all, it is countries with historically low levels of development that will be most adversely affected – and the provision of financing, technology and skills transfer to developing countries to adapt to climate change and mitigate its impacts will be critical.

Achieving sustainable growth in the global economy is one of the themes of the Osaka Summit and we are pleased that the priorities outlined by the Japanese presidency include quality infrastructure, universal health coverage and human capital development.

South Africa is working to address the triple challenge of inequality, unemployment and poverty. We are prioritising education and skills development starting with the introduction of two years of compulsory early childhood development. A national health insurance scheme is being introduced to overcome inequality in our healthcare system.

We are implementing a national economic stimulus and recovery plan to promote inclusive growth. This includes reprioritising public spending towards key infrastructure such as schools, roads and clinics, and establishing an infrastructure fund to which government will contribute R100 billion over the next 10 years.

We are prioritising the oceans economy and tourism as key drivers of economic growth. Our low-carbon growth path includes measures to attract investment in renewable and clean energy. We have established the Commission on the Fourth Industrial Revolution to identify policies, strategies and plans that will position us as a leading country in the evolution and development of technological change.

We have ratified the agreement to establish the African Continental Free Trade Area, which will provide a market of more than one billion people and a combined GDP of $3 trillion.

As the G20, our priority must be to overcome poverty and inequality, because uplifting the material conditions of our peoples is fundamental to stimulating the global economy. To do so means we must go back to basics.
We must focus on providing quality education, achieving universal health coverage, building the industrial capacity of developing countries through infrastructure development and addressing structural challenges that limit the ability of developing countries to trade.

We must mitigate and adapt to the impact of climate change and pursue low-carbon, inclusive and resilient developmental pathways.

We must ensure that the benefits of the digital economy are spread in an inclusive manner. We are pleased therefore that harnessing the power of technological innovation is one of the overarching themes of the Osaka Summit.

We must consistently reinforce the position that a rules-based multilateral system is the linchpin of global governance, and that dialogue and cooperation are critical if we are to achieve a world of peace and prosperity for all.

As nations of the world, our fortunes and our challenges are intertwined. Sluggish global growth impacts us all, but it is the poor, the disadvantaged and the marginalised who suffer most.

In his call to action at the 2005 Make Poverty History concert, President Nelson Mandela said: “Do not look the other way; do not hesitate. Recognise that the world is hungry for action, not words. Act with courage and vision.”

Today, these powerful words are more relevant than ever. The G20 must act with courage and vision. We must harness our collective energies and act with determination to resolve the most pressing issues of our time. The success of the Osaka Summit will ultimately be judged by our actions and not our words.