The G20, the world’s largest economic forum, is tasked with hashing out solutions to some of the thorniest problems facing the global economy.
This year, the list of challenges facing the club of leading economies, whose headline summit takes place on Tuesday and Wednesday in Bali, Indonesia is more daunting than usual.
Inflation in many countries is running at 40-year highs, in large part due to soaring energy prices, as the war in Ukraine and China’s “zero COVID” policies disrupt supply chains.
As central banks ramp up interest rates to tame runaway prices, there are growing fears the world may soon lurch from a cost-of-living crisis to a global recession.
At the same time, the United States, China and other leading economies are facing urgent calls for drastic action to avert a looming climate crisis.
Meanwhile, despite the summit’s optimistic tagline, “Recover Together, Recover Stronger,” prospects for cooperation at the first summit since the invasion of Ukraine appear to be slim as the US and its partners find themselves increasingly at odds with China and Russia.
“The issue of inflation, which is immediate, and the longer term issue of having more sustainable development to reduce our carbon footprint requires global coordination which is difficult in a much more fragmented world where geopolitical tensions are rising,” Trinh Nguyen, a senior economist for emerging Asia at Natixis in Hong Kong, told Al Jazeera.
“So the challenge for the G20 is to bring leaders, who diverge in geopolitics, together to find common ground and solutions to both short-term and longer-term crises.”
Nguyen said inflation, above other issues, will top the agenda as it has “impacted everyone from households that find essentials more expensive to corporations.”
Nguyen added that another challenge for the G20 would be to forge a more integrated global supply chain that is less vulnerable to geopolitical shocks such as Russia’s invasion of Ukraine.