G20 MFAs pledged to address food security

The finance chiefs of the Group of 20 largest economies pledged today to tackle global food insecurity and rising debt, but made few policy cuts amid divisions over Russia’s war in Ukraine at a two-day meeting in Indonesia.

With questions mounting about the G20’s effectiveness in tackling the world’s big problems, US Treasury Secretary Janet Yellen said differences had prevented finance ministers and central bankers from issuing a formal communique, but that the group had “strong consensus’ on the need to address the worsening food security crisis.

Hosts Indonesia will issue a presidential statement instead. Finance Minister Sri Mulyani Indrawati said most issues were agreed by all members except for specific statements on the war in Ukraine. She called it the “best result” the team could have achieved in this meeting.

Western countries have imposed tough sanctions against Russia, which it says is conducting a “special military operation” in Ukraine. Other G20 countries, including China, India and South Africa, were more subdued in their reaction.

“This is a difficult time because Russia is a member of the G20 and does not agree with the rest of us on how to characterize the war,” Yellen said, but stressed that the disagreement should not block progress on pressing global issues.

Russia’s finance minister attended the meeting virtually, while his deputy attended in person. Ukraine’s finance minister delivered a virtual greeting at the meeting, where he called for “tougher targeted sanctions”.

Indonesia’s Sri Mulyani said that while the presidency of a fractured G20 had been “quite overwhelming” because of the war in Ukraine, all members agreed that food insecurity required special attention and called for the lifting of trade protectionist measures blocking the flow of food supplies .

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

Analysts said the failure to agree on a communique reflected the weakness of the once powerful economic group.

“We are in a moment of global economic governance with the G20 paralyzed by Putin’s war and the G7 unable to lead on global public goods,” said Kevin Gallagher, head of the Center for Global Development Policy at Boston University. .

G20 members rallied at the start of the pandemic, but initiatives to ease the shock for heavily indebted poor countries have failed to produce significant results.

Western countries, concerned about the lack of transparency in China’s borrowing, have been pressing Beijing to restructure its debt covenants and transform its role into “one that (contributes) to the country and not one of over-indebtedness and servitude,” he said. US Ambassador to Japan Rahm Emanuel; But they were frustrated that Chinese officials did not attend the meetings in person, making sideline discussions impossible.

Kristalina Georgieva, head of the International Monetary Fund, warned that more than 30% of emerging and developing countries – and an impressive 60% of low-income countries – are in or close to debt distress. Read the full story

“The debt situation is rapidly deteriorating and there should be a well-functioning mechanism to resolve the debt,” she said.

Sri Mulyani said the G20 also encouraged further progress on the implementation of the common debt framework beyond the debt service moratorium initiative in a timely, orderly and coordinated manner.

He said there are discussions about how the framework can be made more effective for countries that need it.