G20 finance chiefs urged to focus on global recovery goals; formal communique unlikely

NUSA DUA, Indonesia – Indonesia on Saturday, July 16, urged G20 finance leaders to stay focused on their goals for global economic recovery, but sources said the meeting in Bali would likely end without a formal communique as Russia’s war in Ukraine continues to divide the group.

Indonesian Finance Minister Sri Mulyani Indrawati, who is hosting the two-day event, is expected to issue a chair’s statement summarizing the events of the meeting instead, two sources familiar with the matter said.

“We do not expect a communique,” one source said.

Senior Western officials, including US Treasury Secretary Janet Yellen and Canadian Finance Minister Chrystia Freeland, on Friday, July 15, condemned the war and blasted Russian officials for the massive economic fallout caused by the war.

Ukraine finance minister Serhiy Marchenko, who addressed the meeting virtually, called for “more severe targeted sanctions” against Russia for its invasion of Ukraine. What the Kremlin calls a “special military operation” has overshadowed recent G20 meetings, including last week’s gathering of foreign ministers.

Indonesian central bank governor Perry Warjiyo said on Saturday members had held fruitful discussions but that the G20 must deliver concrete results to support the global economy.

“It is important that we remain focused on what we have planned to achieve this year, as this will also send a positive message to the global community on the G20’s role and efforts to support global recovery,” Warjiyo said when he opened the second day of meetings.

Sri Mulyani had hoped delegates could bridge their differences over the war to jointly address rising commodity prices, an escalating food-security crisis and the spillover effects on the ability of low-income countries to repay debt.

That proved too difficult in the current climate, with Western countries enforcing strict sanctions on Russia and accusing it of war crimes in Ukraine that Moscow has denied.

Other G20 nations, including China, India and South Africa, have been more muted in their response.

Western sources warned earlier in the week it would be difficult to agree on a communique because the body works on the basis of consensus and Russia had blocked language about the cause of the economic downturn that has prompted the World Bank and International Monetary Fund to downgrade growth forecasts.

“The G20’s capacity to act and communicate is very strongly hindered by the war in Ukraine, which one of the G20 members is fully responsible for,” a French finance ministry source said.

The group on Saturday will discuss post-pandemic financial stability, crypto-assets and climate-related financial risks, among other topics. – Rappler.com