G20 summit, keep it or scrap it?

By Xu Duo, Jin Minmin
0 CommentsPrint E-mail Xinhua, June 24, 2010
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The leaders of the Group of 20 will gather over the weekend in Toronto, Canada, in a bid to inject fresh impetus to the global recovery and wean the world off stimulus packages.

The task is tough because the stimulus measures have to be phased out without hurting the nascent and fragile recovery. But still tougher is the question frequently asked in the "post-crisis era" -- whether it is necessary to keep the G20 summit, a seeming byproduct of the financial storm.

And the answer is yes. We need not only to keep the summit but also to make it a constant and regular gathering tuned to a world with unprecedented changes and currents underway.

The world economy has become increasingly intertwined and the economic and monetary policies of one country will inevitably exert an impact on other countries.

We need not to look further for perfect examples. The sub-prime mortgage crisis in the United States boiled over into a worldwide financial storm and the ensuing global recession. The world economy is still reeling from the devastating power that storm unleashed.

A worldwide crisis calls for a worldwide solution. The G20 summit was exactly brought into being against such a backdrop. It is tasked with providing a platform for countries to coordinate and cooperate on policies with a view to ensuring a sustainable global recovery.

Another trend lends even more legitimacy to the existence and the reform of the summit. According to IMF figures adjusted to nominal exchange rates, output from 2000 to 2009 by emerging economies accounted for 33.6 percent of the world's overall production. That's up 10.1 percentage points from the previous decade.

The share by developed economies in the same period declined to 66.4 percent. The IMF projects that in the "post-crisis era" from 2010 to 2015, the market share by developed economies will further shrink to 58.1 percent. The declining trend, the IMF says, will continue until 2020 when developed and developing economies will make equal contributions to the world's production.

According to IMF estimates, the so-called BRIC nations -- Brazil, Russia, India and China -- will rise to rank among the world's top ten economies by 2015.

At the same time, PricewaterhouseCoopers, a top audit and consulting firm, forecasts that only the United States and Japan among all developed countries will remain in the world's top five economies by 2030.

All of these things mean one thing: the world will not and should not listen to only one speaker. The emerging economies are entitled and capable of having more say in the formation of a new economic order.

It is expected that the G20 summit will play an increasingly essential role in the world economy, but we have to admit there is much room for improvement.

The summit needs to be institutionalized and make itself more efficient in decision-making. It should also make efforts in advancing and implementing the deals reached and coordinating stances among members.

A widely representative, effective and efficient institution, which can speak with one voice and speak for all is what each and every one of us would like to embrace.

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