As all you G20 nerds out there probably already know, next Monday, 1 December, Turkey officially takes the reins as G20 president. That means today is the final working day of the Australian presidency.
Ahead of the Brisbane Summit, Lowy Institute Executive Director Michael Fullilove and I wrote that Australia had used its host year to good effect and that Australia's G20 moment had arrived. It seems clear now that Australia has taken advantage of that moment. The thing that stands out from 2014 has been the clear articulation, then achievement, of the G20's goals.
The G20 achieved what it said it would to boost growth and jobs and build a stronger, more resilient economy. In many respects this reflects an evolution of the G20 away from the initial response to the financial crisis towards a second phase focused on lifting growth in countries affected by the crisis.
The achievements were also broad-ranging, so much so that the promised three-page leaders' communique needed to be squeezed into small text and narrow borders. Fortunately, though, the sprawling paragraphs of previous declarations are a thing of the past since Finance Ministers met in Sydney in February. Instead, a legacy of Australia's presidency will be of headlines and substance across a broad range of issues, tied together in a neat, coherent narrative (except, perhaps, for the Leaders Statement on Ebola).
On promoting growth and jobs, the IMF and OECD assessed that that the G20's campaign to lift growth by 2% by 2018 is achievable through the commitments made to date. To make it more meaningful, leaders submitted to peer review and to regular assessments by the IMF and OECD. This has been a commendable effort, although it should not be seen as mission accomplished. Despite the best of intentions, not all measures will be implemented, and further commitments will be needed over the next four years. And the next step will be to see the G20's efforts translate into upgrades in IMF and OECD forecasts [fold]
2014 also saw the development of the multi-year Global Infrastructure Initiative, with the Brisbane Summit's addition being the announcement of Global Infrastructure Hub, an international organisation to progress the infrastructure agenda that will be located in Sydney for the next four years. The Hub has the potential to make a welcome contribution to the global investment challenge, although as Hugh Jorgenson and I noted in Brisbane, the announcement of the Hub raises some questions.
The first year of the G20's tax agenda saw progress on modernising international tax rules to combat base erosion and profit shifting, actions to address bank secrecy, and steps to include developing countries in the international tax agenda. Now come the negotiations on the tougher agenda items that will be less easy to reach agreement on, such as on countering harmful tax practices and the pricing of tranfers within companies, and the need to chart a longer-term path.
Six years on from the beginning of the financial crisis, we saw a shift from the 'responding to the crisis' phase of financial regulation to the 'finalising the policy framework' phase. Developments in 2014, including a proposal for too-big-to-fail banks to hold yet more capital to protect taxpayers from losses (seen as the last major piece of the policy framework puzzle) are ongoing issues, but during the Australian presidency the G20 has reshaped this narrative towards a focus on the implementation of existing commitments and revamping the way the Financial Stability Board works.
The real mark of the presidency's success, though, is that it achieved well beyond the narrow growth and resilience rhetoric. In particular, the Summit committed to put 100 million women into jobs and tackle corruption through strong principles on beneficial ownership.
The final language on climate change and Ebola should also be acknowledged in this spirit. Much has been made, including from Mike Callaghan, of Australia's reluctance to entertain these topics ahead of the Summit and the credit Australia could have claimed if it had acted differently. I won't add to that debate here, but I will point out that G20 leaders were able to provide direction on both issues, which will maintain some momentum heading into a more receptive Turkish presidency. Further, even if a great opportunity for stronger commitments was missed, it will be difficult to argue that the G20 has focused just on economic fundamentals in 2014 and missed the bigger moral picture.
Momentum has, unfortunately, not extended to all aspects of the agenda. The deadlock on IMF reform continues, with uncertain prospects under the new US Congress. With the IMF still heavily dependent on borrowed resources and bilateral loans that will expire by end-2016, 'Plan B' alternatives still not clear but unlikely to deliver substantial long-run improvements, and China signaling ever more loudly that it has the capacity to develop work-arounds to the existing global financial architecture, this topic will need greater attention in 2015.
But the achievements go on in other parts of the agenda. There was the recognition that more collaboration is needed on energy issues, with energy ministers asked to meet in 2015 and report on options to take this work forward. Australia also got lucky on trade, with the US-India deal on the WTO Bali trade facilitation agreement.
Australia's success will only be fully determined in years to come, once we know if the growth target is achieved, the Hub becomes a known entity, and the multi-year agenda on tax, financial regulation, climate change, trade, energy, and IMF reform progress further. But for the moment, we can safely say that the presidency has ushered in a second, post-crisis phase for the G20, and provided much-needed momentum to the forum.
Over to you, Turkey.