Indonesian Finance Minister Sri Mulyani (front C) attends the G20 finance ministers meeting in Nusa Dua on the Indonesian resort island of Bali July 16, 2022.
SONNY TUMBELAKA | SWIMMING POOL | AFP via Getty Images
World leaders kick off a meeting on the vacation island of Bali, Indonesia on Tuesday as the global economy grapples with a looming recession, giant central bank rate hikes and a historically high inflation.
The annual meeting of leaders of the world’s major economies, known as the Group of 20 nations, also comes as Russia’s war in Ukraine drags on and relations between Washington and Beijing remain strained.
The gathering of officials representing more than 80% of global GDP and 75% of global exports marks the 17th meeting since the platform was launched after the 1999 Asian financial crisis as a meeting of finance ministry officials and leaders central banks.
Who is present?
Nineteen countries and one economic region, the European Union, will participate in this year’s two-day G-20 meeting.
This year’s list of in-person attendees have been in the spotlight as Russian President Vladimir Putin continues his unprovoked war in Ukraine.
Putin will not attend the summit and will instead be represented by Foreign Minister Sergei Lavrov, who left a meeting of G-20 foreign ministers in July as his global counterparts called for an end to the war in Ukraine. Reuters reported Putin could join virtually.
US President Joe Biden is also due to hold a bilateral meeting with his Chinese counterpart Xi Jinping ahead of the G-20.
Other participants include new British Prime Minister Rishi Sunak and Saudi Crown Prince and de facto leader Mohammed bin Salman, who recently led an OPEC+ initiative to cut oil production of 2 million barrels per day to support prices.
Expectations are “not very high”
Little progress is expected from Biden and Xi’s reunion, according to Andrew Staples, Asia-Pacific director of Economist Impact, the policy and insight arm of The Economist Group.
“Expectations aren’t very high,” he told CNBC’s Martin Soong, adding that lingering geopolitical tensions are holding back global growth. He pointed to China’s stance on the war in Ukraine as one of many signs of eroding US-China relations.
“The business community around the world is very concerned that these geopolitical tensions are having a negative impact…that we have in Ukraine, which China has unfortunately been somewhat ambivalent about in regards to President Putin, is really hurting the global economy,” he said.
“Finding a floor in this relationship — which Biden seeks to do — will be positive, not only for the business world, but also for global economic sentiment,” he said.
The role of Russia
Russia’s latest move to constantly reverse its stance on the UN Black Sea Grains Initiative is “likely to eclipse all other negotiations in Bali”, said Laura von Daniels, head of research on the Americas at the German Institute for International and Security Affairs. in a Council on Foreign Relations report.
The OK, reached earlier this year, aimed to ease Russia’s naval blockade and reopen Ukraine’s main ports to deliver crops through a humanitarian corridor in the Black Sea. It expires on November 19.
“Agreeing would cost Russia nothing,” von Daniels said. “It would, however, allow Xi and Putin – as leaders of authoritarian states – to be applauded on the world stage for ensuring food security.”
The meeting comes as a large majority of the world reopens borders and lifts Covid-related restrictions – leaning into the post-pandemic era with its slogan, “Recover Together, Recover Stronger”.
Members agreed that “stimulus should be withdrawn appropriately during the recovery”, the Indonesia’s G-20 Presidency said in a July memo published before the meeting. She referred to a survey she conducted among Member States.
He said the potential for a more lasting impact of the coronavirus pandemic on global growth would be a key topic of the meetings taking place in November.
“Risks arising from supply disruption, rising inflation and weak investment are the top three risks that need to be urgently addressed as far as the scars of the pandemic are concerned,” he said. he said, stressing the need for global cooperation, including the gradual reopening of borders to support Commerce’s revival.
“We all have some version of a problem with inflation and rising interest rates as well, so the whole world has a stake in making progress here,” Australian Treasurer Jim Chalmers told CNBC’s Martin Soong. “The conditions are high risk and they are volatile,” he said.