Translating the G20's Talking Points
Leaders at yesterday's G20 summit in London affirmed a commitment to bailing out developing countries. Just how is this plan spelled out? Change.org blogger Michael Kleinman was at the meeting and conveniently excerpted the sections of the G20 Communique that speak to the needs of the world's poorest nations.
Included in the Communique's promises:
$50 billion to support social protection, boost trade and safeguard development in low income countries, as part of the significant increase in crisis support for these and other developing countries and emerging markets;
Social protection for the poorest countries, including through investing in long-term food security and through voluntary bilateral contributions to the World Bank’s Vulnerability Framework, including the Infrastructure Crisis Facility, and the Rapid Social Response Fund;
The use of additional resources from agreed sales of IMF gold, together with surplus income, to provide $6 billion additional concessional and flexible finance for the poorest countries over the next 2 to 3 years.
For a candid, on-the-ground synopsis of the summit, check out G20Voice, a group of bloggers from 22 countries who had all-access passes to the summit. G20 voicers feverishly posted photos, video and audio clips that highlight discussions most relevant to poor countries.
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What first: Bail out the water, or fix the hole in the boat?
Many have said the recent G20 summit was less elitist than previous summits because the developing world was represented this time. However, representation came in the form of one delegate for each of the large regions of Southeast Asia and Africa.
So how much say did developing countries really have in this summit, and how are they implicated?
One important measure of the Summit allows for $250 billion of trade credit for developing nations. This large amount of financial assistance pledged by the G20 is a step towards bailing out struggling nations in the global south. Yet the issue of debt cancellation was not directly addressed. Rather, about $50 billion of the $1 trillion pledge will be directed towards the IMF, giving this international financial institution the go-ahead to greatly increase the amount they can lend. It remains to be seen how much of these loans will be given to developing countries.
The BBC News reported on the reaction of the developing world to these numbers. Some believe the IMF bailout is necessary to keep the proverbial boat from sinking. Ethiopian Prime Minister Meles Zenawi — the African representative at the summit — claimed that "it would be cheaper to pay countries to get out of their economic problems now than have to fund the consequences of conflict later."
Yet many are skeptical about the ability of the IMF and World Bank to alleviate the financial crises in the developing world without more direct representation and funding. Some human rights groups have spoken out in a critique of the summit: Mary Robinson of Oxfam International said, "More money to the IMF and World Bank is welcome but alone will not be sufficient. The G20 must put poor countries at the centre of its agreement, not in the margins."
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