The importance of infrastructure investment in setting the agenda for the 2016 G20 is highlighted by Scholars.

 

As the chair of the 2016 G20 summit, China is responsible for setting the agenda and promoting cooperation amongst the G20. Scholars shared their wisdom on the topic at the fourth China and Global Governance Forum organized by the School of International Studies at Peking University on June 12.

Role of host nation
Some scholars at the forum pointed to the relative paucity of results achieved at the G7 summit in Germany earlier in June as an indicator that the influence of the leading group of developed nations on global governance has begun to wane. In recent years, the more inclusive G20 has replaced it as the major platform in this field, they said.

The G20 is the result of efforts to mitigate the effects of the international financial crisis. It reflects a new international political and economic order characterized by a shift of economic power and the rise of emerging economies.

“The establishment of the G20 signals the end of the dominance of developed countries and brings diversification to global economic governance,” said Sun Zhenyu, chairman of the China Society for World Trade Organization Studies.
 

An increasingly strong China is committed to playing an active role in international affairs, improving international governance, giving voice to developing countries, offering solutions and providing more public goods. The presidency of the 2016 G20 summit is an opportunity for China to fulfill its commitment, Sun said. “With no permanent secretariat and staff, the summit is held by the host country, which will set up a temporary secretariat for coordination and organization. As a result, the host country plays a significant role in setting the agenda and guiding related work.”

Infrastructure investment, financing
In addition to the prescriptive agenda of promoting steady, balanced and sustainable growth, the host nation can set other optional agendas. Instead of trying to cover all topics, China should focus on the key issues in the agenda, said Wang Yong, a professor from the School of International Studies at Peking University.
 

Scholars present at the meeting said that the 2016 summit should advocate infrastructure investment and financing cooperation, which were prominent topics at the 2014 summit. According to the 2014 communiqué, overcoming the shortage of infrastructure investment is vital to economic growth, employment and productivity.
 

Sun said there’s a huge funding gap in Africa, the Middle East, South Asia, Latin America and even in North America. Without support from all governments and international financial institutions, it would be difficult to embark on infrastructure projects that cannot be completed in a short time. “The 2016 summit in China should encourage cooperation among international and regional financial institutions to fund infrastructure projects, especially those in developing countries.
 

China is exploring various approaches to this end, said Zhou Qiangwu, deputy director of the Asia-Pacific Finance and Development Center of the Ministry of Finance. The negotiation on the regulations of the Asian Infrastructure Investment Bank (AIIB) concluded in Singapore at the end of last month. He added that the AIIB is a complement to the existing multilateral bodies, such as the Asian Development Bank, the World Bank and the European Investment Bank. They together will contribute to closing the funding gap and promoting sustainable development in Asia.
 

Post-2015 goals
“In light of the UN Millennium Development Goals beyond 2015, the G20 summit in China will serve as a major platform for leaders from developed and developing nations to communicate,” Sun said. Compared with financial and economic issues, development problems have greater influence on the long-term interests of developing countries and also affect the long-term relationships between developing and developed countries.

At the UN Millennium Summit in September 2000, world leaders agreed on a set of goals and indicators to eradicate poverty, starvation, disease, illiteracy, climate degradation and discrimination against women. And 2015 is the deadline year for the goals. “Now the biggest challenge is the huge gap between available capital and promised capital,” Sun said.
 

Developed countries promised to take out 0.7 percent of their GDP to assist developing countries but most OECD member states failed to meet the commitment, except for Sweden, Norway and Luxembourg.

Sun suggested the G20 summit in China should strengthen cooperation with the UN, support the role of the UN and its affiliations in development, and improve the capabilities of international financial institutions to reduce poverty. In addition, the summit should urge developed countries to fulfill their international obligations and grant duty-free, quota free access for the least-developed countries as soon as possible. Moreover, more attention should be paid to food security and the North-South imbalance, he said.

 

Mao Li is a reporter at the Chinese Social Sciences Today.