While Julia Gillard is visiting sunny Los Carbos, Mexico this June for the G20 Summit, we can expect her two days to involve slightly more anxious activities than the tourist favourites of sunbaking and golf.
Coming to prominence during the GFC, the G20 is now attempting to look beyond current economic and financial problems to address long-term challenges through international economic cooperation.
This year the G20 will address the concerns of developing countries, including food security, green growth, and the fostering of financial inclusion. One challenge for the G20 will be to incorporate these diverse goals into its framework for global strong, sustainable and balanced growth.
We can expect the G20 to endorse actions promoting the economic development of the globe’s developing nations and continuing efforts on the fight against world poverty. The united support of the group of nations that represents 90 per cent of global GDP is a crucial stepping-stone in order to mitigate global resource insufficiency.
The priorities associated with developing nations outlined by this year’s host of the summit, Mexico, are extensively aligned with the World Bank’s strategic aims.
Such link is evident, as the G20 will deliberate measures to strengthen of the financial system of developing states and foster and promote financial inclusion to aid economic growth. The World Bank directly supports the development of trade agreements and a domestic financial sector (banks, insurance providers) in developing states, in part because it enhances fiscal security.
The sustainability related goals of the G20 are correlated with actions by the World Bank, through sustainable development, green growth and climate change adaption and mitigation programs. This is undertaken by facilitating the transfer of expertise to policy makers and an array of projects from developing drought resistant crops to the installation energy efficient light bulbs.
We see the World Bank will be a successful vehicle in which priorities of this year’s G20 summit can be achieved with respect to developing countries. After all, the World Bank is an agency designed to provide financial and technical assistance to economic underdeveloped nations.
How can the G20 add value to the work of the World Bank? ABBA’s hit record has the answer; “Money, Money, Money”. If the current amount of global expenditure in poverty eradication and development was sufficient, it would not be an agenda item at G20. The answer must be simple for the G20 leaders then – they must contribute more to foreign aid, and in turn contribute more to the World Bank.
So how is Prime Minister Gillard going to respond to the predicted G20 consensus that more needs to be delivered the World Bank?
In the announcement of the 2007 allocation of the nation’s piggy bank, then Prime Minister Kevin Rudd pledged to double the foreign aid budget as a percentage of national income by 2015.
Recently, Foreign Minister Bob Carr confirmed that such promises will be deferred in order to bring the current budget into surplus. This occurred despite the assurance of an increase in aid effort was reaffirmed at the last federal election.
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