MJIEL Vol 7 Issue 2 2010 - Editorial

Communication Flows in International Economic Law

 

 

The G20 was established in response to the 1997 Asian Financial Crisis. Since 1997 the G 20 has met on a number of occasions to respond to subsequent global financial crises. According to the G20 website:

 

The concerted and decisive actions of the G20, with its balanced membership of developed and developing countries, helped the world deal effectively with the current financial and economic crisisReflecting on these activities and recognising that more needs to be done to ensure a strong sustained and balanced recovery, the G20 Leaders at Pittsburgh Summit designate the G20 as the premier forum for international economic cooperation.

 

Whilst communication flows in international economic relations unquestionably are necessary and thus positive, there are three aspects of the G20 claims set out here that are somewhat controversial at the level of composition, arrogation of status and function, and performance in crisis management. First, the G20 comprises of 19 countries and the EU. The developing countries include Argentina, Brazil, China, India, Indonesia, Mexico, Turkey and South Africa. This composition is hardly representative of the developing countries or the development condition, or indeed balanced. Although it embraces a significant proportion of the world gross national product, trade and population in aggregate it does not mirror a proportionate and fair distribution of these factors worldwide nor does it include other considerations that are relevant in the design and management of a coherent, integrated and representative international economic system. Second, the wisdom of the arrogation of the status of a premier institution in international economic cooperation is at odds with the role and status of existing international economic institutions, particularly the IMF. Whereas the Managing Director of the IMF may well participate ex-officio in the G20 meetings this state of affairs does indeed detract from the constitutional status of the IMF qua such a forum in international economic relations and the international efforts at entrenching good governance in the decision-making processes of the IMF. Moreover, given the policy linkages between different international economic spheres, the focus on financial ministers and central bank governors in G20 meetings distorts co-operation in the in the monetary and financial sectors alone. Finally, the recent G20 Summit Meeting of June 2010 in Toronto hardly sent a decisive and clear signal as to the direction of the co-ordination in the management of domestic economies in response to the aftermaths of the global financial crisis.

Perhaps the G20 may be the precursor of a truly global institution for international economic co-operation at the policy level. In an imperfect world this must be a good omen!

 

  Asif H Qureshi

  Editor-in-Chief


 


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