G20 finance leaders make some policy advances at Indonesia meeting

NUSA DUA, Indonesia, July 16 (Reuters) – A group of finance chiefs from 20 major economies pledged on Saturday to address global food insecurity and rising debt, but made few policy advances at a two-day meeting amid divisions over Russia’s war in Ukraine. In Indonesia.

As questions grow about the G20’s effectiveness in tackling the world’s major problems, US Treasury Secretary Janet Yellen said the differences prevented finance ministers and central bankers from issuing a formal statement, but said the group had a “strong consensus”. Addressing the worst food security crisis.

Host Indonesia will instead issue a chairman’s statement. Finance Minister Shri Mulyani Indravati said most of the topics were agreed upon by all the members except the specific statements on Ukraine war. He described the meeting as “the best decision” the group could have reached.

The West has imposed tough economic sanctions against Russia, which it says is conducting “special military operations” in Ukraine. Other G20 countries, including China, India and South Africa, have been more muted in their response.

“This is a challenging time because Russia is part of the G20 and disagrees with us on how to characterize the war,” Yellen said, but stressed that the disagreement should not prevent progress on pressing global issues.

Russia’s finance minister attended the meeting virtually, while his deputy attended directly. Ukraine’s finance minister addressed the session, where he called for “even tougher targeted sanctions.”

As Indonesia’s Sri Mulyani presided over a G20 summit that was fractured by the war in Ukraine, all members agreed that food insecurity needed special attention, and he called for the removal of trade protections blocking food supplies.

The G20 will set up a joint forum between finance and agriculture ministers to address the issue of food and fertilizer supply. A similar forum has been set up for finance and health ministers on pandemic preparedness.

Analysts said the failure to adopt a report reflected the weakening of the once-mighty economic bloc.

“We are at a rudderless moment in the global economy as the G20 has been crippled by Putin’s war and the G7 has failed to deliver on global public goods,” said Kevin Gallagher, president of Boston University’s Center for Global Development Policy.

G20 members rallied around the start of the pandemic, but efforts to cushion the shock for heavily indebted poor countries have failed to yield significant results.

Western countries, concerned about the lack of transparency in China’s debt, are pressing Beijing to restructure debt agreements and change its role to one of “(contributing) to the country instead of debt and slavery,” said Rahm, the U.S. ambassador to Japan. Emanuel. But they were frustrated that Chinese officials did not attend the meetings in person, making side-by-side discussions impossible.

Kristalina Georgieva, head of the International Monetary Fund, warned that more than 30% of emerging and developing countries – and 60% of low-income countries – are in or close to debt crisis. read more

“The debt situation is rapidly deteriorating and a well-functioning debt settlement mechanism must be in place,” he said.

Shri Muliani said the G20 encouraged further progress in implementing a common framework for debt treatment beyond the debt service moratorium initiative in a timely, orderly and coordinated manner.

He said discussions were underway on how to make the framework useful for countries in need.

Additional reporting by Stefano Suleiman in Nusa Dua and Lee Thomas in Paris; Editing: William Mallard, Kanupriya Kapoor, Tom Hogue and William Mallard

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