G20 in urgent need of reform

The heads of government of the world’s 19 most important countries and a representative of the EU are meeting in Hamburg. We may expect the following images for the G20 summit: demonstrations, possibly also violent, as well as harmonious pictures of the heads of state. The meeting will then be concluded with a final statement already prepared in advance. Unfortunately, however, the outcome of the meeting will bear no relation to its high costs.

What a pity! After all, some very important issues are on the agenda. Digitalization and how it can help the world grow together are to be discussed. Areas such as climate protection policy and health crisis management require close coordination and networking between the countries concerned. Alongside these special issues, the agendas of the G20 consultations basically feature virtually all sub-areas of fiscal and economic policy.

These are all very important issues. They have a lasting influence on the economic and social development of most countries. And independently of the agenda, the international G20 community has one other paramount goal: securing stability in the individual countries and within the international community of states. At the same time, this basic goal is naturally also interpreted in line with their interests. But generally it has worked very well in the last few years.

But since the election of the new US President the political environment has changed. With his “US first” slogan Donald Trump has placed self-interest further to the fore again. This has naturally not gone without reactions from other countries. Unfortunately, the pursuit of common goals can only succeed if all important countries participate. If individual large countries drop out it is hard to maintain the dynamics.

Despite all past upsets, so far reason has won the day. Admittedly, the US Administration has decided to drop out of the Paris climate agreement. The remaining countries nevertheless still believe it is necessary and right to pursue the agreed climate targets. They are standing by their resolutions. Amusingly, some US states now also intend to stick to the climate agreements and thus set an example for the USA as a whole.

But not only are international treaties at jeopardy due to the US government’s – in some cases – questionable stance on individual topic areas. The fragile stability in some crisis-stricken regions also risks being destroyed in the long run. If the USA focuses more on its own interests, then its commitments are open to question. The already difficult situation in the Near East and in some parts of Asia threatens to deteriorate yet further and to take on an unfavorable momentum. Europe could be an alternative stabilizer here. But it would have to speak with a single voice and be able to act faster. In the times of Brexit this is a very difficult enterprise.

Generally, therefore, the question is whether the idea of G20, but also of organizations such as the International Monetary Fund, which are after all built on the same ideological scaffolding, are nearing their end. These organizations and their structure still reflect the post-war order. But the modern world has long been a fully different one. The world has become multipolar. In this world countries feel committed to some fundamental ideals. But there is an increasing number of topic areas where not all countries are able to come together in support of the proposed solutions. There are signs that the International Monetary Fund’s monopolistic role is increasingly being broken up and supplemented by regional organizations in Asia and Europe.

Do we not also need to develop ourselves towards a sort of network systematics in the international community? There is a certain basic understanding on many values, but for the individual problem areas in some cases different groups of countries come together to solve a problem. While this can only function to a limited degree for global problems such as climate policy, for many questions this would be a modern approach that could lead to more fitting solutions. Naturally, such an organizational form would be demanding for governments as they would permanently need to knit and create new networks. Long-rehearsed diplomatic routines would lose importance. But in the end it would be a consistent further development of current guiding concepts.

Such networks would have a different dynamic than today’s political group dynamics. Presumably, countries that only have an eye for their own advantage would be gradually marginalized. In the medium term, they would then suffer economic disadvantages. In such a system the unilateral raising of import duties, for example, would not be sustainable over the long term.

Could one continue to expect stability in such a world? Basically yes, although the solutions would be more clearly geared to the members. In addition, there would presumably also be several solutions for a problem, which would do justice to the diversity of the world. But voters are also an important component. If an individualistic policy partly based on exclusion fails to find majorities, then governments would change. With the mounting influence of the coming generation we can look to the future with hope.

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