Creating environments for global growth: Australia’s G20 presidency

Australia will soon welcome leaders of the world’s major economies for the G20 Summit in Brisbane – the city of my birth. The centrepiece of Australia’s agenda as G20 president has been to boost collective G20 economic growth by more than two percent above ‘business as usual’ by 2018.  This would deliver $2 trillion to global GDP and generate millions of additional jobs.

As a crucial part of lifting growth, G20 members have agreed a Global Infrastructure Initiative that could help drive investment across the G20 and beyond.  The Initiative will create a database of infrastructure projects to help match potential investors with projects.  The Philippines’ own Public Private Partnership Centre is a successful example of such an initiative.  It seeks to reduce the infrastructure deficit in the Philippines by identifying bankable projects and bringing them to the attention of investors.  The Australian Government is working to help build the Centre’s capacity and help manage these complex projects.  A mechanism to implement specific elements of the Global Infrastructure Initiative will be announced in Brisbane.

G20 members are also focused on ensuring the global financial crisis is not repeated. We strengthened financial institutions and fostered global stability, and will now monitor new risks.  The Philippines was quick to announce it would implement the new global standard for bank capital reserves. The Bangko Sentral ng Pilipinas has now gone even further to ensure the stability of the banking sector, and recently increased the minimum capital requirement.  This will further strengthen the Philippine banking system after permitting more foreign banks to operate.

The G20 is on track to deliver on its two-year work plan to address tax avoidance.  This will help ensure governments receive the revenue needed to provide services for their people.  G20 members agreed a plan for the automatic exchange of information between tax authorities across the world.  This will help identify and catch tax evaders, with exchange to begin by end-2018.

This is substantial progress, but the global economic situation is increasingly difficult and threatens to undermine our gains.

The International Monetary Fund has revised down its global forecast for 2014.  The World Trade Organization now expects global trade volumes to grow just 3.1 percent this year, down from the 4.7 per cent they predicted earlier in the year. The International Labour Organization said that 2013 global employment was 62 million jobs lower than it would have been, had pre-crisis trends in output and employment continued.

However, the G20’s membership covers over 85 percent of the world economy.  Its actions reverberate in every corner of the globe. Achieving the G20’s growth target would put the world’s economy back on track.

Through the two percent target, the G20 is striving to create an environment that is conducive to growth.  This means removing impediments to private sector growth, enabling free trade, and lifting participation and employment – particularly of women and young people.  The Philippines is a top performer in the Asia-Pacific in terms of gender equality. It placed fifth out of 142 countries in the World Economic Forum’s Global Gender Gap report, which measures economic participation among other indicators.  Other countries in our region could learn a lot about gender equality from the Philippines.

Australia is committed to making a real change for the better at the Brisbane Summit.  G20 members do not seek growth for its own sake, but to help all people find new and better jobs, expand business in international markets and to build the infrastructure this century demands.

I believe it is an outcome well worth the effort.

(Bill Tweddell is the Ambassador of Australia.)