With the world in economic and geopolitical turmoil, the G20 Bali Summit is a moment for its leaders to live up to the spirit of solidarity and collaboration – and bring the world to a full recovery
For Indonesia, its G20 presidency reflects both great trust and enormous responsibility. It is the time for Indonesia to show its competence as a respectable emerging global leader to bring the world to a full recovery from the Covid-19 pandemic. Indonesia must also bridge the severe disagreements between G20 members in coping with the current geopolitical turbulence.
Since Indonesia started its G20 presidency in early December 2021, it has been strongly committed to leading the G20 in carrying out its mandate as the premier forum for its leaders’ global economic cooperation.
G20 sherpas held their first meeting on 7–8 December 2021 to share the G20’s theme and priority agenda under Indonesia’s presidency. This was followed by the first meeting of finance and central bank deputies on 9–10 December, which focused on the priority agenda for the G20’s finance track. There were high hopes that under Indonesia’s presidency, the G20 would find the most feasible strategies for a strong recovery from the hard harmful impacts of the Covid-19 pandemic.
Throughout 2022, Indonesia will have hosted 184 G20-related events, including the Bali Summit, 20 ministerial and central bank governors meetings, 17 sherpa or deputy-level meetings, 56 working group meetings, and 90 engagement groups meetings. Indonesia has also held more than 253 side events. In total, there will have been more than 437 events in 25 different cities.
A bumpy road
The road to the G20 summit has faced multifaceted challenges since severe geopolitical tension abruptly emerged in mid-February 2022. The global economy, still suffering from the Covid-19 pandemic, is now confronted with energy and food supply disruptions that further spurred the food and energy crisis and rising inflationary pressure.
The G20 must anticipate a future economic recession with coordinated actions, while continuing to cure the scarring effects of the Covid-19 pandemic, to disentangle global supply chain disruptions and address other serious concerns that have haunted the global economy since the Covid-19 pandemic began in early 2020.
While these exacerbated challenges are evidently much more difficult to tackle, G20 members are sharply divided in responding to the Russia-Ukraine war. Many G20 leaders called for the suspension of Russia’s membership in the G20; others wanted to keep Russia participating in its meetings and called for the G20 to focus on its priority agenda.
Despite these multiple challenges and the high pressure on its leadership, Indonesia’s presidency has made several creditable achievements.
Navigating a sharp divide
First, Indonesia has avoided a possible break-up of the G20. Occupying the driver’s seat, Indonesia has effectively navigated the sharp divide among G20 members and maintained the very existence of the G20 as a premier forum for global economic cooperation, with the participation of all 20 members. Indonesia highly values inclusiveness, also welcoming the active contribution of several invited countries and relevant international organizations at the G20 meetings.
Furthermore, Indonesia’s presidency has renewed the definition of consensus in a context where the unanimous agreement of all members is almost impossible to reach. It has also strengthened the principle of multilateralism in a context where members tend to adopt a unilateral approach for the sake of their utmost pivotal national economic interests.
Building a consensus that requires unanimity is much more challenging, particularly given current geopolitical tensions. Some G20 members openly declared that no consensus would be achieved unless all G20 members accepted their non-negotiable position on the primary cause of the current geopolitical tension. Indonesia fully respects the coexistence of their different standpoints in building consensus in the G20 and has not forced meetings to produce joint statements.
Second, Indonesia’s presidency has convinced G20 members to continue focusing on the main priority agenda and to deliver concrete implementable outcomes, in spite of some continuing deadlocks.
The G20 finance and health ministers agreed to establish the Financial Intermediary Fund for Pandemic Prevention, Preparedness and Response and secured over $1.4 billion in financial commitments for this purpose. The new fund is housed at the World Bank with technical support provided by the World Health Organization.
The G20 energy ministers agreed on the Bali Compact, discussed intensively in the Energy Transition Working Group. The document comprises basic principles for accelerating the energy transition. They can become a point of reference for G20 members in speeding up their energy transition.
Other deliverables include:
- Non-Binding Guiding Principles to Support the Multilateral Trading System for Achieving Sustainable Development Goals and the G20 Compendium on Promoting Investment for Sustainable Development/Bali Compendium, prepared by the Trade, Investment and Industry Working Group;
- the Bali Package, prepared by the Digital Economy Working Group;
- the Action Plan on Accelerating and Monitoring the G20 Principles for the Labour Market Integration of Persons with Disabilities and the G20 Policy Principles on Adapting Labour Protection for More Effective Protection and Increased Resilience for All Workers, prepared by the Employment Working Group;
- the 2022 edition of the Technical Annex, the KPI Dashboard and Best Practices Playbook, prepared by G20 Empower;
- the Bali Guidelines for World Tourism Recovery, prepared by the Tourism Working Group;
- the 2022 G20 Sustainable Finance Report, prepared by the Sustainable Finance Working Group; and
- the Infra Tracker 2.0 and G20 Compendium of Case Studies on Digital Infrastructure Finance, Issues, Practices and Innovations, prepared by the Infrastructure Working Group.
Third, the G20 remains fully committed to strengthening the role of other multilateral forums. Under Indonesia’s presidency, the G20 fully supports the United Nations’ role as the most legitimate universal organisation to bring global peace and security and ensures the effectiveness of the WHO as the leading institution in global health governance. G20 members continue to support the reform of the World Trade Organization to promote a fair and just trade system. Members have also renewed their commitment to support the success of the UN climate conference in Sharm el Sheikh.
The G20 Bali Summit constitutes the most strategic forum for global leaders to demonstrate their true commitment to pursue constructive collaboration in response to the deteriorating global economy and to the overwhelming geopolitical uncertainty. The Covid-19 pandemic is not yet over. The economic recovery remains very fragile. The G20 Bali Summit is a moment for its leaders to live up to the spirit of solidarity and collaboration among G20 members and to consolidate their concerted efforts in preventing catastrophic economic collapse.