G-20 Finance Chiefs Urged to Focus on Global Recovery Goals; unlikely official statement

Indonesian Finance Minister Sri Mulyani (front C) attends the G20 finance ministers meeting in Nusa Dua on the Indonesian resort island of Bali on July 16, 2022.

SONNY TUMBELAKA | SWIMMING POOL | AFP via Getty Images

Indonesia on Saturday urged G-20 financial leaders to stay focused on their global economic recovery goals, but sources said the Bali meeting would likely end without an official statement as Russia’s war in Ukraine continues. to divide the group.

Indonesian Finance Minister Sri Mulyani Indrawati, who is hosting the two-day event, is expected to issue a presidential statement summarizing the events of the meeting instead, two sources familiar with the matter said.

“We’re not expecting a statement,” a source said.

Senior Western officials, including US Treasury Secretary Janet Yellen and Canadian Finance Minister Chrystia Freeland, on Friday condemned the war and criticized Russian officials for the massive economic fallout caused by the war.

Ukrainian Finance Minister Serhiy Marchenko, who addressed the meeting virtually, called for “tougher targeted sanctions” against Russia for its invasion of Ukraine. What the Kremlin calls a “special military operation” has overshadowed recent G-20 meetings, including last week’s meeting of foreign ministers.

“It is important that we remain focused on what we set out to achieve this year, as this will also send a positive message to the global community about the role and efforts of the G-20 in supporting global recovery,” the Minister said. Governor of the Indonesian Central Bank, Perry Warjiyo. said at the opening of the second day of meetings.

Western countries have imposed tough sanctions on Russia and accused it of war crimes in Ukraine, which Moscow has denied. Other G-20 countries, including China, India and South Africa, have been more muted in their response.

“We are in a rudderless moment in the global economy with the G-20 crippled by Putin’s war and the G7 unable to direct global public goods,” said Kevin Gallagher, who directs the Global Development Policy Center at the ‘Boston University.

Sri Mulyani had hoped that delegates at this week’s meeting could jointly address rising commodity prices, the escalating food security crisis and the ripple effects on the ability of low-income countries to repay their debt.

Members of the G-20 seemed reinvigorated at the start of the pandemic, but initiatives aimed at cushioning the blow for heavily indebted poor countries have not produced significant results.

US Ambassador to Japan Rahm Emanuel told reporters this week that the lack of transparency in China’s loans to developing countries was a “major axis of coordination” between the US and Japan. , both of which are part of a G7 infrastructure push to counter the China Belt and Road Initiative.

Emanuel said loans from China have caused problems in Sri Lanka, Pakistan and other countries.

“There is a pattern. Regardless of China’s footprint, you have countries not only financially and economically dependent, but also in a death trap,” he said.

Western countries were pressuring China to restructure these debt contracts and transform its role into “a role that contributes to the country rather than a role of indebtedness and servitude”, he added.

On Saturday, the G-20 will discuss post-pandemic financial stability, crypto-assets, and climate-related financial risks, among other topics.

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