Second, while it remains to be seen to what extent it will help to bring countries’ contending economic strategies into line, this rediscovery of basic values comes just as the G20 is starting to include international development issues in its deliberations. Naturally, it is my profound hope that the principles of fairness, balance and the common good will also inform these discussions – and not only those on issues such as undervalued currencies, lopsided trade statistics or skewed consumption patterns, however important they may be.
Unfortunately, the signs are decidedly mixed. The global repercussions of the financial and economic crises have clearly nourished an understanding of the true extent and consequences of our interdependence. At least for a moment, there seems to have been a consensus that a world that restricts the benefits of globalization to a few at the expense of many is neither fair nor stable; that one cannot address trade imbalances without addressing the development imbalances that underlie them; and that it is in everyone’s interest to see the developing world graduate out of instability and economic dependence as soon as possible.
But all these realizations have not yet led to the fundamentally different policies that are so urgently needed. In many G20 countries, the crises, and particularly their effects on the world’s poor, appear already all but forgotten and business and politics have resumed with little regard to the damage caused, the trust destroyed, and the lessons learned. Several G20 members have even used the economic upheavals as an excuse to tighten protectionist policies in direct contrast to their repeated pledges to keep markets open. As so often, developing countries have been among the primary victims.
This is deeply unfortunate, since the G20 states, both individually and collectively, are the natural drivers of development. They are, by definition, the countries with the capacity, resources, influence and, thus, the moral obligation and responsibility to help those less fortunate. Many of them have only recently graduated into major economies, and their developmental experiences are still fresh. These countries understand that the key to development is not charity but equitable, job creating and, ideally, green economic growth fuelled by investment in the productive sectors, agriculture, infrastructure, renewable energy, trade, knowledge and technical skills.
They also appreciate that the most important sources of development finance must be domestic revenues and private-sector investment and that aid’s main value other than in meeting urgent humanitarian needs is to increase capacities, reduce dependence on external support, and lubricate and leverage investment in the sources of growth and good governance.
It is thus encouraging that the development agenda proposed by South Korea speaks as much to these realities as to a new sense of partnership and genuine mutual accountability. The document, as far as it is known, covers all the right points, including the unblocking of existing initiatives and the need to complement the efforts of other actors such as the G8, the G77 and, of course, the United Nations. If the leaders assembled in Seoul decide to take it on with the same universal values in mind that they now invoke in the areas of trade and exchange rates, we will have gained much.
Having said all this, the implementation of the valuable ideas entailed in the Korean proposal should not be made dependent on the G20’s taking them on as a group. While a renewed commitment to development by the world’s most powerful group would certainly be a major step in the right direction and send an important political signal to developing countries, it is, of course, not enough on its own to overcome the immense challenges that these countries face. Nor does it necessarily invalidate some of the concerns raised regarding the G20’s legitimacy and capacity.
What really counts is that each member of the group internalizes the concepts of fairness, balance and the common good and adapts its behaviour accordingly. If the G20 setup can help them do so by playing to its unquestionable strengths of composition, reach and sheer economic prowess, this will be all the better and should not only be welcomed, but encouraged.
Kofi Annan, secretary-general of the United Nations from 1997 to 2006, is chair of the Africa Progress Panel.
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