At the 15th G20 Summit in Saudi Arabia in November, it was officially announced that Indonesia will assume the presidency of the grouping in 2022.
In preparation, President Joko “Jokowi” Widodo has issued a Presidential Decree creating a national committee for organizing next year’s G20 Summit. The decree, issued in May 2021, outlines the involvement of various Indonesian ministries in preparing for the event, including the Ministry of Foreign Affairs, the Ministry of Finance, and the Coordinating Ministry for Economic Affairs.
Following Jokowi’s mandate, these three strategic ministries have all presented Indonesia’s vision for the G20 Summit. Firstly, Indonesia’s Foreign Minister Retno Marsudi recently identified some key issues to be discussed by the world’s 20 most advanced economies. Retno has emphasized the urgency of focusing on the global recovery from the COVID-19 pandemic and the importance of building stronger productivity, resilience, sustainability, partnership, and leadership among the G20 nations. She also said that Indonesia would work to strengthen diplomacy in the health sector, underlining the current wide COVID-19 vaccine gap between developed and developing countries.
Coordinating Minister for Economic Affairs Airlangga Hartarto added Indonesia’s interests in pursuing structural and financial reforms following the COVID-19 pandemic, including in such fields as digitalization, human resources development, and the empowerment of women and youth. He has also cited the importance of the G20 leading global efforts to mitigate the risks of future pandemics. Minister of Finance Sri Mulyani endorsed the question of financial reforms, stating that Indonesia will prepare a sustainable finance track agenda ahead of the summit. The discussion will cover the development of more robust infrastructure financing, financial regulation, and financial inclusion, as well as a green financing agenda.
While Indonesia’s domestic concerns have been spotlighted by the three ministers, the G20 is not only about the host’s own interests; it should address issues relevant to the group as a whole. So what are the main priorities for the G20 countries today?
Without a doubt, the COVID-19 pandemic will be at the top of the agenda of next year’s summit, as evidenced by Indonesia’s choice of “Recover Together, Recover Stronger” as the main theme of the meeting. While the grouping effectively handled the aftermath of the 2008 financial crisis, the challenges posed by the pandemic are both more severe and more multifaceted. Moreover, the pandemic has appeared amid a host of other concerning global challenges and trends, from rising populism and polarization to democratic regression and persistent economic inequalities. Many argue that the COVID-19 pandemic has accelerated these trends, while also revealing the significant gap between G20 governments in crafting coherent, rapid, and effective measures for battling the virus. The crisis has also disclosed the weaknesses in the current system of global governance, including forums like the G20.
The G20 has also been criticized for its sluggish and inadequate pandemic response. Although the group has met a couple of times to discuss the COVID-19 crisis, the proposed cooperative actions were not compatible with individual governments’ incentives. Each government has prioritized its responsibility to protect its own citizens, not the group as a whole. In this sense, the G20 has not been immune from the growing nationalism that has confounded various forms of multilateral cooperation, prompting one scholar to describe the grouping as “missing in action” on COVID-19.
The predominance of the United States within the group may have also contributed to the G20’s failures. Under the leadership of Donald Trump for instance, the U.S. extended its rivalry with China to the group, thus disrupting collective efforts to handle the virus. Like many multi-level organs of international governance, the G20 is arguably not immune to the power gap between its members. The situation calls for substantive reform, and Indonesia may seek to make progress on this next year. While the leadership changes in the White House may provide a greater degree of G20 solidarity, much of the tension between Beijing and Washington remains.
Perhaps the most discussed criticism of the group is the fluidity of G20 Summit agenda. Each host country is allowed to bring something new to the G20 agenda every annual gathering and thus contributes to the grouping’s lack of a consistent and sustainable policy response. In this case, Indonesia needs to ensure that the final G20 Action Plan can help individual member states achieve their own goals.
Indonesia’s position will be mostly focused on representing the voices of the developing countries sitting outside the G20. Last year, for instance, Jokowi conveyed the importance of debt restructuring for low-income countries and the financial support for developing states to escape from the economic downturn caused by the pandemic. With these specific interests in mind, Indonesia should be able to encourage all G20 members to develop the political will necessary to revive the global economy. Indonesia must act as the guardian of G20 multilateralism, not merely speaking as a “developing country.” Consensus is a rarity in global governance today, and therefore, fairness and inclusiveness among members must be demonstrated as critical values.
In designing policy, the participation of all relevant stakeholders is necessary so that the policy outcomes rightfully address public demands in general, including from the youth. Youth is one of the groups of the world’s population that has been hit the hardest by the current crisis. The young generation is currently facing a more digitalized world with a high risk of unemployment and shifting job requirements and skills. In many G20 economies, youth represent a majority of the population and are hence a major driver of economic growth. Their insights will be invaluable if the G20 is to produce more appropriate and effective policies.
Indonesia’s agenda for the G20 Summit next year is aligned with last year’s OECD report on Policies for a Strong Recovery and a Sustainable, Inclusive and Resilient Future, which described the importance of developing and distributing health equipment and diagnostics – particularly COVID-19 vaccines – equally, promoting efficient and robust global value chains, building a more environmentally sustainable economy, and preventing sudden capital outflows and sovereign debt crises. However, in the process of negotiation, Indonesia is required to anticipate the “political” division among the G20 member states. Indonesia may conduct some pre-summit meetings with major countries like China, the U.S., the United Kingdom, and Japan to gain political support in advance. These consultations will be essential if Indonesia hopes to succeed in pursuing significant reform during the period of its presidency.
Founded in 1999, the G20 was initially a grouping designed to respond to the 1997 Asian Financial Crisis. Now that the COVID-19 pandemic has unleashed a host of social, economic, and political challenges on the world, the presence and contribution of the G20 are under the spotlight. Indonesia’s hosting of next year’s G20 Summit offers a chance for Jokowi’s administration to reaffirm the nation’s leadership, and help build consensus among the world’s largest economies toward the collective solution of global problems.