The G20 countries have at last emerged as the central global policy makers. At least that is what one infers
from the summit's declaration: G20 will now replace the G8 as
the body responsible for the global economic policy coordination.
Never in the past, since the industrial revolution, had
the developing world got the opportunity to voice its concern
in shaping the world economic policies, as it has today. Yet,
it cannot be said that G20 is representative: Latin America
and Europe are over-represented, while Africa and the
Islamic world are under-represented. Yet, the present member
countries represent two-thirds of the world population,
generating 90% of the global gross product and 80% of world trade.
This, of course, is in itself a great achievement for the comity
of nations, which are mostly driven by narrow national interests.
Coming to the deliberations per se, the summit
could somehow manage to resist the move from some towards
`business as usual' and get the members to agree to defer
`exit strategies' from expansionary monetary and fiscal policies
for the time being by declaring, "We pledge
today to sustain our strong policy response until
a durable recovery is secured ... We will avoid any premature withdrawal of stimulus. At
the same time, we will prepare our exit strategies and, when the time is right, withdraw our
extraordinary policy support in a cooperative and coordinated way, maintaining our
commitment to fiscal responsibility."
|
