The finance chiefs of the Group of 20 major economies are likely to do little more than highlight the deep rift that has formed between member countries next week when the forum holds its first ministerial-level meeting since the invasion of Ukraine. by Russia.
G-20 members, including Russia and the United States, have a plethora of issues to negotiate if they hope to pull the global economy out of the COVID-19-induced slump and mitigate the impact of the Ukraine crisis.
US President Joe Biden said in late March that Russia should be kicked out of the G-20 framework in response to its invasion of Ukraine, and Treasury Secretary Janet Yellen said last week that the US would boycott certain G-20 meetings if Russian officials showed up.
Photo taken on April 10, 2022 shows a view of kyiv from a high point after Russian troops completed their withdrawal from the Ukrainian capital. (Kyōdo) == Kyōdo
Russian Finance Minister Anton Siluanov has reportedly confirmed that he will attend the meeting virtually, meaning a clash is likely.
Russian President Vladimir Putin’s spokesman Dmitry Peskov said the G-20 is an important format but his country’s exclusion would not be “fatal” given that most members are “in a state of economic war with us”, according to the Russian news agency Tass.
The G-20 meeting involving finance ministers and central bank governors will meet on Wednesday on the sidelines of the spring sessions of the International Monetary Fund and World Bank in Washington.
“The G-20 has played a role in identifying global issues and raising awareness about them,” said Atsushi Takeda, chief economist at the Itochu Research Institute. “But this time whether it can work depends entirely on who will be at the meeting.”
The potential split between members, who account for 80% of global gross domestic product, would be a significant setback at a time when coordinated efforts are essential to tackle emerging and current challenges, economists say.
The economic outlook has been clouded by persistently high inflation, exacerbated by Russia’s late February attack on Ukraine, which sent energy and other commodity prices soaring.
The tightening of US monetary policy, which began in March in response to inflation rising at its fastest pace in more than 40 years, also puts the currencies of emerging economies at risk of weakening and therefore falling. increase their external debt burden.
Russia’s potential default on its external debt, caused to some extent by Western sanctions, would also weigh heavily on the financial sector.
The Group of Seven was once the Group of Eight until Russia was expelled amid global outrage when it annexed Crimea from Ukraine in 2014.
But there is no mechanism to exclude a country from the G-20, with a Japanese government source describing it as “difficult to exclude Russia from the G-20 framework”.
“If Russia attends the meeting, we must have a majority and rant at it,” the source added.
Brazil, India, China and South Africa, which together with Russia form the BRICS forum, continued to support Moscow’s participation in the G-20.
Chinese Foreign Minister Wang Yi recently said that no one has the right to dissolve the G-20. Brazilian Foreign Minister Carlos Franca said his country clearly opposes Russia’s exclusion from the group.
Australian Prime Minister Scott Morrison in late March called Putin’s intention to attend the G-20 summit in Indonesia later this year “a step too far”. Canadian Prime Minister Justin Trudeau has said Russia cannot be a constructive G-20 partner because of its invasion of Ukraine, according to Reuters.
The G-20 includes Argentina, Australia, Brazil, Great Britain, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey, United States and Europe. Union.
The rally in Washington would provide just another opportunity for Moscow and Western countries to play the blame game, economists say.
“The G-20 meeting could become an event that symbolizes a split in the international community caused by the Russian invasion,” said Tsuyoshi Ueno, senior economist at the NLI Research Institute.
Even in the absence of Russia, tough discussions were expected on soaring energy prices between exporters and importers as well as coordinated growth efforts amid an uneven recovery from the fallout of the pandemic, a- he declared.
Japan, US finance chiefs to meet amid yen’s rapid fall against dollar