G20 Framework for Strong, Sustainable, Balanced and Inclusive Growth: German Presidency Outcomes and Recommendations for the Argentinian Presidency

Abstract

The Framework for Strong, Sustainable and Balanced Growth was adopted by the Group of 20 (G20) in 2009. It contains a wide range of commitments, including the use of fiscal, monetary and structural policies to support growth of gross domestic product (GDP), ensuring trade and investment openness and reducing global imbalances. The Framework's target areas evolve according to global economic conjunctures and the priorities of the presidency. This article studies the main outcomes of the G20's work in 2017 in the context of this evolution, accounting both for the German presidency's Framework priorities (resilient and inclusive growth) and elements of agendas in recent years (fiscal strategies, growth strategies and the enhanced structural reform agenda-ESRA). The findings indicate that the G20 indeed increased its focus on resilient and inclusive growth after concentrating mostly on growth rates in recent years. This is confirmed by the adoption of resilience principles as well as by an increase in the number of corresponding measures in growth strategies. With respect to previous agendas, G20 members succeeded in reducing fiscal risks, implementing growth strategy commitments and ESRA priorities. Still, estimates by the International Monetary Fund (IMF) and the Organisation for Economic Cooperation and Development (OECD) show that the G20 is unlikely to reach its goal of increasing collective GDP by 2% by 2018 through growth strategy measures. Another problem is that international organizations (IOs) do not fully capture the positive effects of G20 commitments on growth and inclusiveness. Overall, to reduce risks of a fall in the G20's credibility, the Argentinian presidency should maintain a focus on resilience and inclusiveness, elaborate a communication strategy for the G20's successes and intensify collaboration with IOs.

The G20, G7 and BRICS in Global Economic Governance

“…Estimates of the G20's success in coordinating macroeconomic policies vary widely. Some experts believe that it was unprecedented in history -the G20 approach to fis cal and monetary stimulus helped restore growth, and the Framework Agreement for Strong, Sustainable and Balanced Growth became an effective mechanism for policy coordination and adjustment [Prilepskiy, 2018]. Sceptics emphasize that the stimulat ing measures of 2009 resulted from the coincidence of the countries' response to com mon problems, rather than triumphal international coordination , and further that the MAP had little effect on G20 members' policies .…”