Encouraging Global Transformation through G20

Didie SW

Indonesia officially assumed the G20 Presidency at the end of 2021. The warm response from various circles, domestic as well as international, offers hope that the G20 will be the right forum to formulate collective solutions to global issues.

We need to understand that, from the history of the organization, the G20 was formed as a forum of dialogue to convey ideas in an informal, flexible manner to arrive at a consensus on a voluntary basis. However, quite a few bright ideas from the G20 have become references for global policy, especially in overcoming financial crises.

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We are currently in the third year of the Covid-19 pandemic while the world awaits a breakthrough from the G20 forum. The crisis that prevails today is not due to economic and financial issues, but rather a health issue that has led to a crisis in the economic and financial sectors. G20 dialogue alone will not be enough to bring about change to immediately relieve the world of its health, economic, and financial problems as well as other derivative issues.

From narrative to parade of actions

Intensive dialogue and fairly harmonious synergy between developed and developing countries in the G20 indeed seem to promise a better future for global governance. But the informality of the G20 forum gives a distinct color to international diplomacy.

The breakthroughs offered to settle global problems involve noncompulsory decisions, playing a greater role in setting the norm with concepts that require concrete actions. Minimal monitoring of deliverables, or the results of implementation, hampers concrete output of the declarations and grandiose communiques that are produced.

The legitimation of the G20 as the premier forum of global economic cooperation should be accompanied by policy actions that serve the common interests as promoted in the spirit of global collaboration or mutual assistance.

For this reason, the G20 needs to change its approach from talking shop to generating a parade of actions that consider the variety of common interests, network interdependence and mutual benefits. The legitimation of the G20 as the premier forum of global economic cooperation should be accompanied by policy actions that serve the common interests as promoted in the spirit of global collaboration or mutual assistance.

Three priority agendas

President Joko Widodo, as the holder of the global mandate, has designated three key priority agendas of Indonesia’s G20 presidency: global health architecture, digital economic transformation and energy transition. The three agendas are references to realize the theme of Indonesia’s G20 presidency, “Recover Together, Recover Stronger”.

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Developing and restructuring the global health architecture is a big challenge that the world is currently facing in overcoming the global health crisis. The interconnectedness that was created as a consequence of globalization has made the world aware that recovering from the pandemic cannot be achieved individually.

LUCKY PRANSISKA

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Total recovery can only be realized through a series of international actions that are coordinated effectively through joint commitments at multilateral forums. Systematic and sustainable financing for pandemic prevention is a crucial issue and will involve resources from the public, private and philanthropic sectors as well as international financial institutions.

The digital economy enables a unique and previously unfamiliar business model, but it also brings with it a new challenge. It should be ascertained that the benefits derived from the advancements in and increasing demand for digital technology is directly enjoyed by society, especially by the micro, small and medium enterprise industry. Digital literacy and digital skills must be enhanced, while state security and data privacy must be safeguarded.

With an internet economy averaging annual growth of 49 percent, Indonesia’s internet economy has recorded the fastest growth in Southeast Asia. Indonesia’s digital economy also has high potential as an investment destination, recording the highest investments in digital platforms among ASEAN states in 2021.

Indonesia has 24 percent of the world’s nickel reserves and has ample opportunity to join the supply chain for batteries and electric vehicles.

The transition to clean and affordable energy is urgent for sustainable development. G20 member countries need to participate in funding and investment projects and in knowledge and technology transfers. Indonesia welcomes the use of vehicles that are more environmentally friendly. Indonesia has 24 percent of the world’s nickel reserves and has ample opportunity to join the supply chain for batteries and electric vehicles.

It is the right time for Indonesia to invite G20 leaders to utilize the G20 forum to discuss concrete actions, accelerate implementation of the existing G20 action plan, respond to the health, economic and social challenges arising from Covid-19 and prevent the broader impacts of climate change.

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French President Emmanuel Macron speaks during a media conference at the G20 summit in Rome, Sunday, Oct. 31, 2021. The two-day Group of 20 summit concluded on Sunday, the first in-person gathering of leaders of the world's biggest economies since the COVID-19 pandemic started. (AP Photo/Domenico Stinellis)

Indonesia offers cooperation in the three priority issues, which will be profitable to G20 member countries. The G20’s extensive policy network should be supported by the participation of governments, business communities, international organizations and transnational movements in the G20, with strong interconnections to back up the achievements of the G20’s output for the common good.

Bilateral channels

Later, the efforts to achieve concrete outputs can be optimized through the bilateral channels among G20 member countries. Through the economic powerhouse scheme, other G20 member countries can enjoy the benefits of cooperation initiated through these bilateral channels. The interests of G20 member countries in bilateral investment, for instance, can be channeled for the development of electric vehicle production centers and energy storage systems in ASEAN and around the world.

The benefits from economic growth should be redistributed so it is inclusive and equitable in promoting the people’s welfare, such as through labor absorption.

For Indonesia, the G20 events have both direct and indirect impacts on its economy. The G20 can be an arena to showcase Indonesia’s socioeconomic progress, present Indonesia’s archipelagic culture and support the expansion of its investment targets. The benefits from economic growth should be redistributed so it is inclusive and equitable in promoting the people’s welfare, such as through labor absorption.

Indonesia is also continuing to improve the quality of its human resources, including through upskilling and reskilling programs in collaboration with businesses. Accelerated infrastructure development for greater contributions to investments and a favorable business climate is being intensified.

Several other development priorities have also been determined and their implementation is underway, including increased food production through the development of food estates, the realization of low carbon development, digital transformation of the economy through the

expansion, equitable distribution and quality improvement of the digital infrastructure and digital services. All these policies are in line with the three key G20 agendas, through which Indonesia can play a role in striving for the fulfillment of various interests, including those of the global community.

KOMPAS/HERU SRI KUMORO

Airlangga Hartarto,

Airlangga Hartarto, Coordinating Economic Minister; Chairman, first Sherpa meeting of Indonesia’s G20 Presidency

(This article was translated by Aris Prawira).