Wrapping up a two-day summit in Brisbane this weekend, leaders from the G20 group of nations pledged yesterday to stimulate job growth, bolster global financial institutions and address climate change.
“We have signed off on a peer-reviewed growth package that, if implemented, will achieve a 2.1 per cent increase in global growth over the next five years, on top of business as usual,” Australian Prime Minister Tony Abbott said.
According to an analysis by the International Monetary Fund (IMF) and the Organization for Economic Co-operation and Development (OECD) earlier this year, the various reforms and initiatives proposed in July by the B20 working group would enable the G20 to achieve its stated goal of lifting world economic growth by more than 2 percent, adding $3.4 trillion to global gross domestic product and creating more than 50 million new jobs over a five year period.
The B20 comprises 300 leaders and CEOs from the world’s major corporations, as well as major industry group representatives from the G20 countries. Recommendations of the group’s taskforce include full implementation of the trade facilitation measures agreed to by the World Trade Organization (WTO) in Bali last year in addition to calling on G20 nations to not only stop introducing new protectionist non-tariff barriers, but to reverse those already in place, including so-called localization requirements.
The group further called on G20 countries “to remove supply chain barriers through targeted infrastructure investment, streamlined border administration (including reduction of corruption in customs clearance), and domestic regulatory reforms.” With regards to free trade, the B20 stated that agreements should “produce value to business commensurate with the effort required to achieve them” All future trade deals should, the group said, be “comprehensive” in nature, be WTO-compliant, include anti-corruption principles, and address “emerging trade areas” such as competition policy, services, regulatory cooperation, and non-tariff barriers.
Of particular concern to the B20 are discriminatory and anti-competitive “localization” measures designed to protect local industries and “national champions” through requirements pertaining to technology transfer, local ownership or hiring, and various restrictions on imports or the cross-border flow of data. Certain practices related to state-owned enterprises (SOEs) also came under critical fire from the B20 in its report. Unfair allocation of quotas, special assistance, export subsidies or other measures “distort global competition and undercut efforts by other companies to build global supply chains,” the group said. Public procurement, especially at the sub-national level, was another area the B20 felt is often prone to measures that amount to protectionist non-tariff barriers.