The G20

The Group of Twenty (G20) is the premier forum for international economic cooperation. The G20 is a group of 19 countries and the European Union. G20 Leaders, Finance Ministers and Central Bank Governors meet regularly to address global economic and financial challenges.

The G20 played a key role in responding to the global financial crisis of 2008-09. The decisive and coordinated actions of the G20 boosted consumer and business confidence and supported the first signs of economic recovery.

The G20 also works to strengthen the global economy, reforming international financial institutions and improving financial regulation. In 2011, the G20’s focus shifted to addressing new vulnerabilities to the global economy arising from the Eurozone sovereign debt crisis.

Representation

G20 members account for 85 percent of the world economy, 80 percent of global trade, and two-thirds of the world's population. The G20 represents all geographic regions of the world, but remains small enough to be an effective decision-making body.

The members of the G20 are:

• Argentina
• Australia
• Brazil
• Canada
• China
• France
• Germany
• Indonesia
• India
• Italy
• Japan
• Republic of Korea
• Mexico
• Russia
• Saudi Arabia
• South Africa
• Turkey
• United Kingdom
• United States, and
• European Union.

The G20 works closely with a number of key international institutions, including the International Monetary Fund (IMF), World Bank, World Trade Organisation (WTO), Financial Stability Board (FSB), International Labour Organisation (ILO), and the Organisation for Economic Cooperation and Development (OECD). Representatives from the UN as well as regional organisations such as ASEAN, APEC, the African Union and the Gulf Cooperation Council have attended past G20 Leaders' Summits. Each G20 host makes five discretionary invitations. In 2012, Mexico, as host, has invited Spain, Benin (as African Union Chair), Cambodia (as ASEAN Chair), Colombia and Chile.

Formation of the G20

The first G20 Leaders' Meeting took place in Washington in 2008. Further Summits were held in London (2 April 2009), Pittsburgh (24-25 September 2009), Toronto (26-27 June 2010), Seoul (11-12 November 2010) and Cannes (3-4 November 2011).

The decisive and coordinated actions of G20 Leaders in response to the global economic crisis restored consumer and business confidence and supported the first signs of economic recovery. The London Summit was pivotal to the G20's response to the global economic crisis; at this Summit Leaders agreed to deliver an unprecedented fiscal stimulus package estimated at over US$5 trillion, as well as an additional US$1.1 trillion in resources for the IMF, Multilateral Development Banks and increased support for trade finance.

The focus of G20 Summits is gradually shifting away from crisis response to rebalancing of global economic growth, strengthening financial regulation and international financial institution governance reform. The agenda also encompasses trade, development, work to identify and eliminate inefficient fossil fuel subsidies, and support for global anti-corruption and food security initiatives.

The G20 Leaders' Summits follow on from the G20 Financial Ministers' and Central Bank Governors' Meetings. Finance Ministers and Central Bank Governors first met in response to the Asian Financial Crisis of the late 1990s. G20 Finance Ministers and Central Bank Governors will continue to meet regularly in support of the Leaders' process. Development Ministers, Agriculture Ministers and Labour and Employment Ministers have also met under the auspices of the G20.

Unlike international institutions such as the OECD, IMF and the World Bank, the G20 has no permanent secretariat of its own. The G20 chair rotates between members, and is selected from a different regional grouping of countries each year. The incumbent chair establishes a temporary secretariat for the duration of its term, which coordinates the group's work and hosts its meetings.

G20 Achievements

To date there have been six G20 Leaders' Summits:

• The Cannes Summit (3-4 November 2011) was dominated by discussion of the global economy, particularly developments in the Eurozone debt crisis. Other major issues discussed included financial regulation, trade, jobs, food security, agricultural productivity and development. The Leaders released a Communiqué, summarising the outcomes of their Final Declaration and The Cannes Action Plan for Growth and Jobs, which included:
  • The development of a country specific Action Plan on Growth and Jobs to address short-term vulnerabilities and strengthen medium-term foundations for growth, including plans for a G20 taskforce on youth employment
  • A commitment to ensure the adequacy of the European Financial Stability Facility (EU Members) and IMF resources (G20 Members)
  •  Reaffirmation of the G20 anti-protectionism pledge (originally agreed to at the 2010 Toronto Summit) and agreement to strengthen the World Trade Organisation by considering additional and parallel negotiations beyond the Doha (Round) mandate
  • Commitment to “stand ready to ensure additional resource could be mobilised in a timely manner” for the IMF
  • Endorsement of a list of 29 global systemically important financial institutions (G-SIFIs) [PDF]. Leaders also agreed to strengthen the regulation and strength of “shadow banking activities” and adoption of an action plan to support the development and deepening of local bond markets
  • Commitment to development as a “key element” of the G20 global recovery agenda; Leaders agreed to focus on food security, infrastructure and financing for development and endorsement of the 2011 G20 Development Working Group Report [PDF],
  • Endorsement of an Action Plan on Food Price Volatility and Agriculture [PDF], aimed at improving agricultural production and productivity, and increasing market information and transparency,
  • Endorsement of a report on the implementation of Seoul’s G20 Anti-Corruption Action Plan [PDF] and welcomed voluntary participation in the Extractive Industries Transparency Initiative (EITI).
• The Seoul Summit (11-12 November 2010) delivered the Seoul Action Plan, under which member countries committed to implement macroeconomic policies to ensure ongoing recovery and sustainable growth and enhance stability of financial markets.
  • Under the Framework for Strong, Sustainable and Balanced Growth, G20 members agreed to develop guidelines to address large current account imbalances
  • Leaders delivered on IMF quota and governance reform, as committed to at the Pittsburgh Summit
  • Significant progress was made on financial sector reform by gaining agreement on the Basel III package of reforms to strengthen supervisory oversight of the global financial system
  • Leaders agreed to a development agenda for the G20, and endorsed the Seoul Development Consensus for Shared Growth and its Multi-Year Action Plan on Development
  • Members committed to fight trade protectionism and promote open trade and investment
  • Leaders made important progress on strengthening global financial safety nets, including enhancement of the Flexible Credit Line (FCL), and the creation of the Precautionary Credit Line (PCL).
• The Toronto Summit (26-27 June 2010) achieved solid outcomes and set directions for the Seoul G20 Summit in November 2010. The Toronto Declaration outlined the following achievements:
  • A commitment by advanced deficit economies to at least halve fiscal deficits by 2013 and stabilize or reduce sovereign debt ratios by 2016. These commitments will be complemented by ongoing structural reform across all G20 members to rebalance and strengthen global growth
  • Agreement to conclude work in the Basel Committee on Banking Supervision on a new global regime for bank capital and liquidity by the Seoul G20 Summit
  • Agreement that the financial sector must make a fair contribution to paying for any burdens associated with government interventions
  • Extension of the pledge to refrain from imposing new protectionist barriers until the end of 2013 and reiteration of support for a successful conclusion to the Doha Round
  • Establishment of a Working Group to elaborate a development agenda which will be adopted by Leaders at the Seoul Summit
  • Furthermore, G20 Leaders acknowledged the fulfilment of their commitment to provide a $350 billion increase in capital to Multilateral Development Banks and associated institutional reforms. G20 Leaders also made progress on quota and governance reform for the IMF.
• At the Pittsburgh Summit (24-25 September 2009) Leaders designated the G20 the premier forum for international economic coordination. The Pittsburgh Declaration included the following commitments:
  • The Framework for Strong, Sustainable and Balanced Growth lays out the way in which G20 countries act together to support the global recovery
  • Reaffirmed commitment to strengthening financial supervision, especially the need to address problem of institutions that are too big to fail
  • Reform global architecture such as the IMF and World Bank to better reflect the realities of the 21st century
  • Support increased access to food, fuel and finance for the world's poor.
• The London Summit (2 April 2009) focused on coordinated fiscal and monetary stimulus measures to avert the threat of global depression. Leaders also agreed on additional resources for the IMF and Multilateral Development Banks to assist countries weather the financial crisis and to the establishment of a new Financial Stability Board (FSB), as well as reinforcing their commitment to oppose protectionism.
• The Washington Summit (14-15 November 2008) focused primarily on strengthening financial regulation and agreement on a 47 point action plan to arrest deteriorating financial market conditions and improve financial regulation over the medium term. Leaders also agreed to resist trade protectionism and work towards the conclusion of the Doha Round.

Future G20 Summits

In 2012 the G20 Summit will take place in Los Cabos in Mexico. Russia will chair in 2013 and Australia in 2014.

Key G20 dates 2012

Date	Meeting	Location
February	Informal Foreign Ministers' Meeting	Los Cabos, Mexico
February	Finance Ministers and Central Bank Governors’ Meeting	Mexico City, Mexico
April	Trade Ministers' Meeting	Puerto Vallarta, Mexico
April	Finance Ministers and Central Bank Governors’ Meeting	Washington, USA
May	Labour Ministers' Meeting	Guadalajara, Mexico
June	G20 Leaders’ Summit	Los Cabos, Mexico
October	Finance Ministers and Central Bank Governors’ Meeting	Washington, USA
November	Finance Ministers and Central Bank Governors’ Meeting	Mexico City, Mexico

Australian participation in the G20

Australia is committed to active participation and policy leadership within the G20. Membership of the G20 gives Australia the capacity to influence key policies relating to the global economy.

• Australia values the G20's commitment to reduce trade protectionism. During the crisis world trade fell by 12.2% (over 2009, WTO). The free flow of goods and services within a rules-based trading environment is key to Australia's economic prosperity.
• Australia has a strong financial sector, with banks performing remarkably well during the global economic crisis. That is why it is important for Australia to have a seat at the table and be involved in guiding development of improved financial standards.
• Australia, alongside South Africa, co-chaired the G20’s IMF Working Group which laid the groundwork for IMF quota and governance reform delivered by G20 Leaders at the Seoul Summit.
• Strong development of the poorest countries is not only important in improving the living standards of these countries, but also in achieving sustainable economic growth for the whole world. Australia will benefit from stronger growth in our trade partners.
• Australia co-chaired the two elements of the ‘Growth with Resilience’ pillar of the G20 development working group during 2011, along-side Indonesia (on the social protection element) and Italy (on international remittances element). Australia also actively participates in other areas of G20 development agenda, including infrastructure and food security.
• Australia and France co-hosted a G20 workshop in October 2011 on 'Re-energising Global Agricultural Productivity' which contributed to addressing the decline in global agricultural yields and bridging the gap between developed and developing country productivity. Australia also co-chaired with France a workshop on the 'New Financial Landscape' in July 2011.
• Australia will chair the G20 in 2014, as announced at the most recent G20 meeting in Cannes, France.
• Australia's engagement with the G20 involves a whole-of-government approach under the leadership of the Prime Minister.

Australia is represented at the G20 Leaders' Summits by the Prime Minister. The Treasurer and the Reserve Bank Governor participates in G20 Finance Ministers and Central Bank Governors Meetings. The Prime Minister and the Treasurer are supported in their engagement with the G20 by the Australian G20 'Sherpa' (the Prime Minister's special representative for the G20) and the Finance Deputy. In 2011, Australia also had an Agriculture Deputy, a Labour Deputy, and a representative on the G20 Development Working Group.

Outreach

Australia is committed to consulting non-G20 members so that their views are considered by the G20. Australian officials conduct regular outreach with our regional neighbours to ensure that the decisions of the G20 reflect the needs of our region. As part of the outcomes at CHOGM in Perth (October 2011), Australia promoted the establishment of an annual officials-level Commonwealth meeting on the G20 development agenda to enhance Commonwealth-countries’ voice on G20 issues. Australia encourages other G20 members to do the same in their own regions, so that G20 decisions benefit all economies.