The top 20 economies share a platform to share, deliberate, and address pressing global economic and financial issues. They call it Group of Twenty or simply G 20. It’s a global platform, which makes up 80% of the gross world product (GWP), 66% of the global population, 75% of international trade, and 60% of the world’s land area. All 5 Permanent Members of the UN Security Council and all 7 members of the G7 are a part of the G20, alongside the most prominent emerging economies.
No wonder, they call it the “premier forum for international economic cooperation.”
African Union: The New Member of G 20
Note that, the G 20 Summit 2023 will be the last one ever. As the African Union (AU) has been granted permanent membership, the G 20 will become G 21 moving forward.
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G 20 in Numbers
(Courtesy: G20 Official Website)
Why G 20 Matters?
Given the sheer numbers, G 20 comes across as a juggernaut that impacts how the world functions.
Let’s explore how.
Think of it as a platform where the world’s 20 leading economies gather to discuss global economic policies. Each decision taken here has an impact on the global economy and all member and non-member countries.
Sets the Global Economic Governance:
G 20 provides a platform for the world’s who’s who to join their heads and find solutions for “financial crises, trade tensions, currency exchange rates, fiscal policies,” and other pressing issues. In that way, it sets the tone for global economic governance.
Prevent and Manage Crises:
Global recessions are a fact of life. And, G20 helps address them through deliberation and collaboration. It allows the major economies to put up a collective response to economic crises and help stabilize global markets.
Bringing Together Both Worlds:
In G 20, developed countries, such as the US, the UK, and France sit with developing countries like India, China, and Argentina. As such, the forum is in a position to take up diverse economic and other issues that the developing and developed world has to face. This gives it a global footing.
Address “Other” Challenges:
While economic issues are at the heart of G20’s agenda, it also helps address other global issues that need urgent attention. These can be climate change, sustainable development, public health, terrorism, or anything else.
Coordinated Policy Making:
The G 20 forum also serves as a platform for the member countries to collectively create policies that help the global economy grow and evolve. When everyone is on the same page, the chances of resolving conflicts, reducing trade tensions, avoiding harmful economic policies, and improving economic stability go up.
The member countries ponder over development initiatives like poverty alleviation, infrastructure building, and improvements in healthcare, education, and other sectors in developing countries.
G 20 Summit 2023 at a Glance:
|President Country & Host: India||Current Chairman: PM Sh Narendra Modi|
|Date: 9, 10 September 2023||Previous President Country: Indonesia|
|Next President Country: Brazil||Agenda: Economy, Cryptocurrency & more|
|Venue: Bharat Mandapam International Exhibition-Convention Centre (IECC)||Theme: Vasudhaiva Kutumbakam|
Who Constitutes G20?
It is one of the most prominent global platforms that includes 19 countries and the European Union. While most member countries are “developed,” some are developing. Spain features as a permanent guest. Here is the list of permanent members as of 2023.
G20 Nations List:
|South Korea||Russia||Saudi Arabia||South Africa|
|Turkey||United Kingdom||United States||European Union|
G 20 Summit 2023: Observers
G20 invites a few non-member countries as observers that partake in the G 20 summit and other meetings. They can participate in discussions, voice their concerns, and provide inputs on the agenda. However, they lack decision-making power, which rests with the members only. Their involvement brings inclusivity and effectiveness into the forum and enriches the discourse.
Participating International Organisations:
Besides countries, G20 also seeks the participation of some major global organizations. These include United Nations (UN), International Monetary Fund (IMF), World Bank (WB), World Health Organization (WHO), International Labor Organization (ILO), Financial Stability Board (FSB), and Organization for Economic Cooperation and Development (OECD).
The Chairs of Regional Organisations, such as the African Union (AU), African Union Development Agency-NEPAD (AUDA-NEPAD), and Association of Southeast Asian Nations (ASEAN) are also there. However, in 2023, under the presidency of India, the International Solar Alliance (ISA), Coalition for Disaster Resilient Infrastructure (CDRI), and Asian Development Bank (ADB) were also invited as Guest International Organizations for the year 2023.
G 20 History:
For the G 20, it all began in 1999 when the world was reeling under the Asian Financial Crisis. The forum owes its origin to another forum, G7, which includes Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States. The platform has been there since for the seven leading economies to discuss global economic issues.
In the mid-90s, the G7 countries felt the need for a more inclusive forum for global economic cooperation to mitigate economic recessions. That led to the creation of the G20 in 1999 with the first meeting held in Berlin, Germany. The finance ministers and central bank governors from 19 countries, (both developed and emerging) and the European Union (EU) attended the meeting to discuss financial and economic stability.
By 2007, the world was facing yet another economic recession. Again, the G7 decided to raise the importance of the G20 by holding a Ledaer’s Summit. The idea behind converting it into a leaders-level forum was to provide a concerted response to the global crisis. The first G 20 Leaders’ Summit was held in Washington, D.C., USA. The venue for the second summit was again Washington, D.C., USA, while Pittsburgh was the venue of the third summit.
Interestingly, the first three summits happened semiannually. It was only after 2011, it became an annual event. The members of the forum have remained unchanged since its inception until 2023 when the African Union was made a permanent member. The scope of the forum has also extended with time. What began as a forum for economic cooperation later included issues like sustainable development, health, agriculture, energy, environment, climate change, and anti-corruption.
Click for the G20 Background Brief: Here
How G20 Functions?
G 20 is a well-organized forum led by the president country. Here is how it goes about its business.
Each year, the presidency passes from one member country to the other on a rotation basis. For instance, India took over the presidency from Indonesia (2020-21) and is supposed to pass it to Brazil for the year 2023-24. India will have to wait till 2043 to lead the forum once again. Only the US presided over the forum twice in 2008 and 2009. Here are the previous and future presidents of G 20.
- 2020: Saudi Arabia (Riyadh Summit)
- 2021: Italy (Rome Summit)
- 2022: Indonesia (Jakarta Summit)
- 2023: India (New Delhi Summit)
- 2024: Brazil
- 2025: South Africa
Wondering why the presidency matters? Well, the president hosts the summit and associated meetings and decides the agenda, priorities, themes, and everything else that goes within the forum. In a way, the G-20 President has a role to play in shaping the global agenda for a year. As the host, it also takes care of logistics, security, and other aspects of the summit.
Each year, the forum holds a summit in the President Country. It’s a mega-event attended by the heads of the states of the member countries. Even civil societies, parliamentarians, think tanks, women, youth, labor, businesses, and researchers of the member nations are in attendance. The summit concludes with a Joint Declaration, which is a reflection of the major agreements, policy directions, and priorities of the summit.
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All heads of the state of member nations attended the G 20 Summit 2023, save for the Chinese premier, Xi Jinping, and the Russian President, Vladimir Putin.
Two Tracks: Finance Track & Sherpa Track
The forum is propelled forward by two parallel tracks, the Finance track and the Sherpa track. While both tracks are independent of each other, they collectively help shape the agenda and ensure fruitful discussions.
1. Finance Track:
As the name says, the Finance Track is about finance-related policy matters. Herein, the finance ministers and central bank governors of the member nations meet twice a year to ponder over economic and financial issues, share information, and coordinate policies. What the forum will discuss at the summit is finalized in these meetings. They forward the recommendations, suggestions, and feedback to the Sherpa track, which then integrates them into the agenda.
2. Sherpa Track:
On the other hand, the Sherpa Track takes care of the diplomatic and administrative processes to make the summit a success. These Sherpas are officials designated by the member countries to look after their interests in the forum. Like the Sherpas that help climbers scale Mt. Everest, these Sherpas help get the best deal for their respective countries. They coordinate, negotiate, and consult their counterparts to help finalize agendas, joint declarations, and agreements.
Suggested Viewing: G-20 Sherpas | In Depth | Drishti IAS English
A bevy of other working group committees also contribute to the proper functioning of the G20 forum. These committees have their respective jobs cut out for promoting discussions, research, and negotiations. Let us run you through some of the major working groups and committees that are an integral part of G 20.
Working Group on the Digital Economy (DEWG):
The mandate of this working group is to promote the “digitalization of economies.” As such, it takes up issues, including, but, not limited to, “digital infrastructure, e-commerce, data governance, and digital innovation.”
Working Group on Sustainable Finance (WGSD):
It is all about facilitating “sustainable finance and investment practices.” The working group finds ways to “align financial systems with sustainability goals and encourages responsible investment practices.”
Development Working Group (DWG):
True to its name, the working group has been focusing on development issues since 2010. It finds ways to bring down poverty, develop infrastructure, empower communities, and promote inclusive growth.
Anti-Corruption Working Group (ACWG):
As the name says, the working group’s mandate is to prevent corruption by developing measures to increase transparency, accountability, and integrity in both public and private sectors.
Energy Transitions Working Group (ETWG):
Countries often face challenges related to energy transitions. ETWG is instituted to mitigate them through discussion, cooperation, and mutual understanding.
Working Group on Trade and Investment (WGTI):
Established in 2016, the working group concentrates on developing trade and investment policies through deliberation. Its focus is on facilitating trade, promoting economic growth, and addressing trade imbalances.
Labor and Employment Working Group (LEWG):
Its areas of concern include “labor and employment issues, including job creation, labor market policies, and workforce development.” It factors in research done by ILO and the OECD and takes feedback from the B20 (employers), L20 (workers), W20 (women), and Y20 (young people).
Global Infrastructure Working Group (GIWG):
While DWG has a wider ambit, the GIWG focuses entirely on infrastructure investment and development. It zeroes in on the critical infrastructure projects in the member countries and helps channel investments for the same.
Climate Sustainability Working Group (CSWG):
As the name suggests, it takes into account climate-related issues. It chalks out a plan to counter environmental challenges through policy initiatives in line with climate goals.
There are a variety of groups that have a role to play in “promoting inclusivity, dialogue, and cooperation”. They engage with various stakeholders, offer policy inputs, advocate for policy positions and priorities, and facilitate consultations and dialogues between governments and stakeholders. These groups include:
- Business Twenty (B20)
- Labor Twenty (L20)
- Civil Twenty (C20)
- Think Twenty (T20)
- Youth Twenty (Y20)
G20 Summit 2023 Schedule:
|Finance Deputies Meeting||5 – 6 September 2023||New Delhi|
|Joint Sherpas and Finance Deputies Meeting||6 September 2023||New Delhi|
|G20 Summit||9 – 10 September 2023||New Delhi|
|4th Sustainable Finance Working Group Meeting||13 – 14 September 2023||Varanasi|
|4th Meeting for the Global Partnership for Financial Inclusion||14, 15, 16 September 2023||Mumbai|
|4th Framework Working Group Meeting||18, 19 September 2023||Raipur|
|4th International Financial Architecture Working Group Meeting||20, 21, 22 September 2023||Seoul, Republic of Korea|
G 20 Leaders
|Argentina||Alberto Fernández||Australia||Anthony Albanese|
|Brazil||Luiz Inácio Lula da Silva||Canada||Justin Trudeau|
|China||Xi Jinping||France||Emmanuel Macron|
|Germany||Olaf Scholz||India||Narendra Modi|
|Indonesia||Joko Widodo||Italy||Giorgia Meloni|
|Japan||Fumio Kishida||Mexico||Andrés Manuel|
|Russia||Vladimir Putin||Saudi Arabia||Salman bin Abdulaziz Al Saud|
|South Africa||Cyril Ramaphosa||South Korea||Yoon Suk-Yeol|
|Turkey||Recep Tayyip Erdoğan||United Kingdom||Rishi Sunak|
|United States||Joe Biden||African Union||Azali Assoumani and Moussa Faki|
|European Union||Charles Michel Ursula von der Leyen|
Member Countries at a Glance
|Country||Trade*||Nom. GDP**||PPP GDP***||Per Capita Income****||Population*****|
- * Trade in Billion USD as of 2022
- ** Nominal GDP in Million USD as of 2023
- *** PPP GDP in Million USD as of 2023
- **** Per Capita Income in USD as of 2023
- ***** Population as of 2021
Engagement Groups in 2023:
Strangely, G20 exists but without a headquarters or secretariat. It is up to the incumbent president country to put together a temporary secretariat for a year. All activities and events are coordinated and facilitated by this temporary secretariat. There is a Troika to support the presidency, which includes the former, present, and incoming presidents. The current Troika features Indonesia, India, and Brazil, respectively.
However, proposals to establish a permanent G20 headquarters have cropped up in the past, notably from the French Premier Nicolas Sarkozy in 2010. He even proposed Paris and Seoul as the potential venues for headquarters. However, opposition from members like Italy and Japan stalled the plan. Interestingly, South Korea came up with the idea of a “cyber secretariat,” which again didn’t fructify.
INDIA’S G20 PRIORITIES
- Green Development, Climate Finance & Lifestyle for Environment (LiFE)
- Accelerated, Inclusive & Resilient Growth
- Accelerating progress on Sustainable Development Goals (SDGs)
- Technological Transformation & Digital Public Infrastructure
- Multilateral Institutions for the 21st Century
- Women-led development
“India kick-started its presidency term agenda with a series of cultural initiatives that included various Jan Bhagidari activities, a special University Connect event with 75 educational institutions from across the country, the lighting up of 100 ASI monuments with the G20 logo and colors, and showcasing G20 at the Hombill festival in Nagaland.”
“Sand artist Shri Sudarshan Pattnaik also created sand art of India’s G20 logo on Puri beach in Odisha. Various other events, youth activities, cultural performances, and site excursions showcasing the sights and traditions of respective city venues, are also planned throughout the year-long calendar.” Source: Government of India.
Criticism of G 20:
All forums have their share of criticism and G 20 isn’t an exception either.
- Some question the presence of certain member countries in the forum. After Russia invaded Ukraine in 2022, several member states rallied for the removal of Russia from the forum. Interestingly, Russia lost its G8 membership in the past, leading to the forum’s transition into the G7.
- Some even point out the failure of the forum in preventing economic crises.
- Since decision-making happens behind closed doors, many critics question G20’s transparency.
- The agreements reached at G 20 are not legally binding on the member countries. So, not all countries honor them.
- Critics also raise questions about G-20’s inclusivity as it leaves out so many smaller and less economically powerful nations.
- Some argue that G20’s policies and priorities are inconsistent or incoherent, especially when dealing with complex global issues like climate change and trade.
- The forum’s effectiveness in handling global challenges is also under scrutiny. For critics, it’s all talk and little action.
- According to some, G 20 fails to regulate the global financial system, which leaves plenty of room for future financial crises.
- G20’s focus on economic growth and neglect of social and environmental issues also draw criticism.
- Critics also argue that the forum lacks the power to implement policies and agreements and hold the defaulting countries accountable.
- Hosting the G 20 summit is a costly affair with plenty of security, logistics, and other hassles involved. For some critics, these costs are unjustified.
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Frequently Asked Questions:
What is the G20?
The G20, or Group of Twenty, is an international forum for governments and central bank governors from major economies.
What is the full form of G 20?
G 20 stands for “Group of Twenty,” which refers to the 20 member countries.
When was the G20 established?
G20 was established in 1999 in response to financial crises.
How many member countries are in the G20?
It consists of 19 member countries and the European Union.
What is the purpose of the G20?
The G20 aims to promote international financial stability, economic cooperation, and sustainable development.
Where is the G20 Summit held?
The incumbent president country is the venue for the leaders’ summit. So, it changes yearly.
Which country hosted the 2019 G 20 summit?
In 2019, Japan hosted the G20 summit for the first time.
What are the key focus areas of the G 20?
According to the G20 official website, the forum focuses on key areas like the global economy, financial stability, trade, climate change, and development.
How does the G20 address global crises?
The G20 was established to counter global crises through a coordinated response
What are the engagement groups of the G 20?
Engagement groups help the forum to function properly and get a wider perspective of the issues at hand. These groups include B20 (business), L20 (labor), C20 (civil society), T20 (think tanks), and Y20 (youth).
How does the G20 address climate change?
Climate change mitigation and adaptation strategies are one of the key focus areas of G 20 that aim to bring down carbon emissions.
What is the “Sherpa Track” in the G 20?
The Sherpa Track involves diplomats and officials appointed by the member countries. They do all the groundwork for G20 meetings and coordinate discussions.
Why do they call G 20 the “premier forum for international economic cooperation”?
The G 20 consists of the top 20 developed and emerging economies. It makes up 80% of the gross world product (GWP), 66% of the global population, 75% of international trade, and 60% of the world’s land area. All 5 Permanent Members of the UN Security Council and all 7 members of the G7 are a part of the G20.
What is the role of the G 20 in international trade?
Facilitating international trade is one of the prime mandates of G 20. To this end, it takes up trade issues, advocates for open and fair trade, and works to reduce trade barriers.
What is the Development Working Group (DWG) in the G 20?
This working group engages in discussions on a variety of development issues, including, but, not limited to, poverty reduction, infrastructure, and sustainable development.
How does the G 20 promote gender equality?
The forum promotes women’s empowerment through friendly policies and discussions on challenges faced by women.
What is the role of observer countries in the G 20?
Even though observer countries have no role to play in decision-making, they can take part in meetings and discussions, voice their concerns, and provide broader perspectives.
How is the G 20 presidency determined?
The G20 presidency rotates annually among member countries. For instance, India is the incumbent president and will pass on the presidency to Brazil.
What is the goal of the G20’s Anti-Corruption Working Group (ACWG)?
The ACWG’s mandate is to fight corruption and increase transparency and integrity at domestic and international levels.
How does the G 20 address global infrastructure development?
The working group is all about facilitating investment in infrastructure projects in the member countries.
What is the G20’s stance on sustainable finance?
The G20 Sustainable Finance Working Group works to align financial systems with sustainability goals.
Why is the G 20 considered significant in global governance?
The G20 represents a significant portion of the world’s economy and plays a vital role in addressing global challenges and coordinating policies.