G20 UPDATE E-NEWSLETTER Issue #17 - October 2013

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2012 2013 2014

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Reﬂections on the Summit Must Read

In “Investment in the In “Building on mixed In “The G20 St. In “Reﬂections from the --Insights from the Future: Preliminary success – from St Petersburg Summit – 2013 Russian G20 BRICS results of Russia’s G20 Petersburg 2013 to Bubbles, Casinos and Summit,” Michael --News from “Down Presidency,” Brisbane 2014,” Nancy Inactivity,” Sameer Switow, Global Council of Under” O. Buklemishev, Associate Waites, Head of Policy Dossani, Advocacy the Global Call to Action --New Think Tank professor at the Economics Research & Government Coordinator, Reshaping Against Poverty (GCAP), Publications Department of Moscow Relations, World Vision Global Power, Action Aid reviews highlights of the State University and Australia, provides a view International describes G20 Summit as they relate member of the Expert of the Russian G20 Summit-related issues, to: international Council for the Russian G20 Summit and the transition such as the currency development, remittances, Presidency, provides an in- to the Australian crises and tax reform. infrastructure, gender, and depth report of the G20’s Presidency. tax avoidance. strengths, weaknesses, and tensions in promoting economic recovery.

Pages 3-5 Pages 6-8 Pages 9-11 Pages 12-14 Pages 8 | 14 | 15

UPDATE Introduction

Highlights of the Russian G20 Summit Introduction G20 Nancy Alexander, Heinrich Böll Foundation - North America

At the September 2013 G20 Summit Arguably, the Summit’s main Buklemishev, the U.S. and others are in St. Petersburg, Leaders faced breakthrough relates to its making monetary policy in a “go it conflicts relating to the Syrian crisis endorsement of an Action Plan to alone” mode, flaunting the G20 and decelerating global growth and, change tax rules in order to stop pledges to work in a collaborative particularly, the role of the monetary transnational corporations (TNCs) fashion. He underscores the policies of advanced countries, from shifting their profits to low- or breathtaking cost of recent monetary especially the U.S., in destabilizing no-tax jurisdictions and, instead, policies for developing countries developing country´s economies. require them to pay taxes to the where the value of national countries where they do business. currencies relative to the U.S. dollar Meanwhile, having reached its five Yet, pressure on the G20 is needed to has been plunging. year anniversary, the G20 Summit strengthen and implement these and released a vision statement other actions, as the newly-elected Finally, Buklemishev describes the congratulating itself for its Australian Prime Minister Tony future G20 policy agenda and ways achievements as the “premier forum Abbott takes over the G20 Presidency Russia will continue to provide on international cooperation”, but on December 1, 2013. Upon taking leadership on this agenda as it failing to acknowledge its deficits: a) office, Abbott’s opening salvos assumes the G8 Presidency in the susceptibility of the global included throwing Indonesian January 2014. economy to another financial crisis; refugees out of the country, cutting b) the interdependence of crises the foreign aid budget, moving the aid In “Building on mixed success – from relating to finance, climate, and agency into the foreign office, and St Petersburg 2013 to Brisbane society; and c) the near-exclusion of vowing to abolish the country’s poorly 2014,” Nancy Waites, (Head of non-member countries in designing functioning Emission Trading System. Policy Research & Government policies that deeply affect their Relations, World Vision Australia) future. (See box, “St. Petersburg New to the G20? emphasizes some misfortunes of the Accountability Report on G20 Russian Summit relating to civil Development Commitments, p. 2.) society representation and exclusion To find out more about the from dialogues with officials. Still, Ironically, while crafting the vision G20’s history, the power Waites emphasizes the G20’s statement calling for deeper dynamics and the issues the momentum on issues championed by engagement with outside groups, group addresses, click on the civil society: combating tax including civil society, Leaders link below. avoidance; tackling inequality through ignored the Russian government’s INTRODUCTION TO THE G20 inclusive growth; and creating jobs, repression of domestic civil society particularly for the most vulnerable. and shunned the civil society presence at the Summit. Only In “Investment in the Future: Waites comments on the St business and labor were invited to the Preliminary results of Russia’s G20 Petersburg Development Outlook, Leaders’ meeting with “social Presidency,” O. Buklemishev including its five core priorities: food partners”; civil society was excluded. (Associate professor at the security, financial inclusion and Economics Department of Moscow remittances, infrastructure, human It is no surprise that the Summit’s State University and member of the resource development, and domestic “outcome documents” are more Expert Council for Russian G20 resource mobilization. reflective of the recommendations of Presidency) provides an in-depth the transnational corporations (TNCs) perspective not only of Summit Finally, she notes that Australian in the Business 20 than those of the outcomes, but also the economic national elections on September 7th Civil 20 (C20) or even the Labor 20 challenges and tensions with which made it impossible for the Prime (L20). On the eve of the Summit, the G20 is wrestling. Minister to attend the Summit. The civil society’s Counter-Summit Australian Foreign Minister attended, delivered a strong Final Declaration He reminds us that, since the 2012 as did the Chair of the new Civil 20 denouncing the capture of Mexican Summit, the economic Steering Committee, Tim Costello, governments by TNCs which causes seesaw has tipped in favor of many CEO of World Vision. systematic violations of the rights of developed countries and against many people and the sustainability of developing countries – some of which In “The G20 St. Petersburg Summit nature. are experiencing signs of the onset of – Bubbles, Casinos and Inactivity,” recession. Moreover, according to

UPDATE Sameer Dossani, Advocacy against the US dollar over the past In “Reflections from the 2013 Coordinator of Action Aid year. In an integrated global market, Russian G20 Summit,” Michael International’s Reshaping Global falling currency values mean rising Switow of the Global Council of the Introduction G20 Power Program, highlights the fact prices; in some countries, food, fuel Global Call to Action Against Poverty that, while the G20 is fixated on and other essential items are (GCAP) reviews highlights of the G20 growth, it is relatively ineffectual in becoming even more expensive. Summit as they relate to: dealing with root causes of the international development, financial crisis (e.g., “too big to fail” On the bright side, Dossani says that remittances, infrastructure, gender, institutions; monetary dilemmas; and the G20’s tax reforms offer a “once- and tax avoidance. He also recounts corporate tax dodging). With regard in-a-lifetime” opportunity to tackle how civil society got its messages to monetary dilemmas, Dossani notes tax havens and transfer pricing across to a media fixated on Syria. that currency markets in South schemes that are kept in place by a Africa, Brazil, India, Turkey and complex network of treaties backed Indonesia seem to be stabilizing after up by armies of lawyers. losing as much as 25% of their value

St. Petersburg Accountability Report on G20 Development Commitments

This 2013 Accountability Report represents the The report includes a color-coded chart “Snapshot first accountability exercise of the G20 of Implementation of G20 Development Development Working Group (DWG) relative to Commitments” that ranks the G20’s performance. the 67 commitments originating from the Seoul Of the 67 commitments, only one is “stalled”; it Development Action Plan relates to assessing “how (DAP) and Leaders’ best to integrate Declarations. environmental safeguards in a cost-efficient In terms of inclusion of the manner” in infrastructure primary “beneficiaries” of development. the DAP -- low-income In some cases, the fact countries (LICs) -- the that commitments are report states that only either completed or on- “Thirteen non-G20 track may be an countries have participated indication of low in DWG meetings since the ambition. For instance, DWG’s inception in 2010” work on inclusive green and only a few of the 13 growth is “on track,” but were LICs. According to how meaningful is it? the report, the LICS want Support for social better communication with protection floors is on- the G20 as well as track, but it’s not clear collaboration with regard to whether any countries are new areas of importance to adopting them. Work on them, such as small state reducing the cost of debt, climate change, remittances is “on-track,” financial and economic but the cost has not been stability; global imbalances, reduced. Moreover, little natural resource Source G20 Accountability Report information is in the management and financial regulation. public domain about pilot projects or plans that are complete, such as the “action plan on water, food and agriculture.”

INVESTMENT IN THE FUTURE: Preliminary UPDATE

G20 results of Russia’s G20 Presidency By Oleg Buklemishev, Associate professor at the Economics Department of Moscow State University, member of the Expert Council for the Russian G20 Presidency Reﬂections on the Summit

License by Fishki.net

As we know, the first summit of G20 is described by classic models of From the beginning of May to leaders took place on November 15, game theory, which vividly mid-August, stock markets in 2008 at a very dramatic moment -- demonstrate that when different, but developing countries lost at the most critical point of the global closely interdependent, players have least US$1.5 trillion, and the financial crisis -- and actually paved contradictory interests, their decline still continues. the way for a new and efficient form determination to pursue their of international cooperation. It is personal benefit may bring about widely accepted that the measures negative consequences for all. near future, financial flows moved coordinated and adopted by the G20 promptly in the reverse direction. It member states played a vital role in As an example, the unconventional was a really hard blow, especially for preventing the total collapse of the monetary policies of “quantitative countries with a large current global financial system, as they easing” pursued by the U.S. and a account deficit. Thus, from June to tackled the most critical stage of the number of other developed states as the end of August, Brazil’s national crisis and gradually took measures to anti-crisis measures, were, currency lost 9.7% of its value restore the global economy to health. undoubtedly, highly effective in against the dollar; Indonesia’s Keeping in mind past global terms of combating recession and dropped by 13.6%, and India’s by economic downturns, the G20 states recovering economic growth. 15.4%, despite the measures taken have combined their efforts to However, at the same time, such by the respective national monetary confront forms of national egotism policies resulted in an influx of “hot authorities to prevent the decline. by helping to prevent protectionist money” to developing markets, From the beginning of May to mid- measures in the sphere of trade and strengthening of local currencies, August, stock markets in developing “competitive devaluations”. and a rapid growth of financial asset countries lost at least US$1.5 prices, which could easily lead to trillion, and the decline still However, as tension on global “bubbles”. The IMF estimated that, continues. markets started to decline, many of since 2009, the overall volume of the G20 member states lost interest capital that flowed over interstate U.S. Federal Reserve in maintaining close cooperation; boundaries due to central bank representatives declared that they focused on domestic issues, activity amounts to almost US$4 they were not obligated to while putting their common interests trillion. (To compare: this represents provide greater transparency on a “back burner.” Thus, after the about a quarter of the total stock or to inform the rest of the first and most fruitful summits, G20 market capitalization of ALL world of the schedule and activity declined. Moreover, the developing countries and emerging potential consequences of leading states gradually relapsed into economies). curtailing their “quantitative a “go it alone” mode of formulating easing”. economic policies, notwithstanding When, in the spring of 2013, Ben S. the potential consequences for other Bernanke Chair of the U.S. Federal states. Reserve said that the monetary To cap it off, in August 2013, at the It should be noted that this situation stimulus would be curtailed in the annual monetary conference in 3

Jackson Hole, Wyoming, U.S. coincidence that the set priorities G20’s anti-protectionist pledge until

UPDATE Federal Reserve representatives (investment, conﬁdence and 2016. Debate participants declared that they were not transparency, effective regulation) highlighted the efforts taken by the obligated to provide greater reﬂected the most urgent needs of Russian Presidency for international G20 transparency or to inform the rest of the time – the need to move from cooperation in important areas such the world of the schedule and post-crisis stabilization towards as food security, energy and climate potential consequences of curtailing economic growth and to secure an as well as the new standards and their “quantitative easing” policy irreversible breakthrough in the recommendations pertaining to the because of their mandate to protect struggle against unemployment. public debt management. It is not by

Reflections on the Summit national interests. This statement chance that, as Italian Prime contradicted the G20 commitments *** Minister E. Letta put it, “there was to coordinate national policies with The central event of Russia’s as much agreement on economic and the partners and to adjust any Presidency was the G20 Leaders’ financial issues as there was measures to take the interests of Summit held in St. Petersburg on disagreement on Syria”. other countries into account (as set September 5-6, which was forth in the Leaders’ Declaration of characterized by both intense foreign Most of the papers endorsed by G20 the 2012 Mexican G20 Summit and policy debates (mainly on the Syrian in St. Petersburg focused on the key the Communiqué of the July 2013 issue), getting the biggest share of target: achievement of strong, G20 Financial Ministers’ and Central international mass media attention, sustainable and balanced economic Bank Governors’ Meeting in and adoption of a number of high- growth spreading to one extent or Moscow). Due to this departure profile documents on social and another across the whole world. from G20 commitments, the economic issues. The most important Since the 2012 Mexican Summit, statement caused an uproar in paper, the G20 Saint Petersburg the state of global economy has developing countries, especially the Action Plan, stipulates specific significantly changed: for most ones hard hit by capital flight. obligations for single states aimed at developed countries, the situation reinforcing the foundation for the has improved; however, growth in future economic growth on a global many developing economies is So despite the long list of scale. (In particular, Russia slowing down and there are signs of undeniable achievements of committed to improve its investment the onset of recession. And now we the G20, the Russian G20 climate, increase financial literacy, are facing a fundamentally new Presidency was clouded by improve protection of consumer challenge, with the period of ultra- growing global frustration rights related to financial services, low interest rates moving towards an about the prospects of and finance infrastructure projects in imminent end. So the focus of improving a collective order to significantly increase the discussions and the measures being approach to policy-making. investment share in GDP). worked out has slightly shifted, although we are still discussing the So despite the long list of undeniable The G20 leaders also adopted need to make progress on the achievements of the G20, the documents, including those listed in following basic elements of Russian G20 Presidency was clouded the box below. international importance in the by growing global frustration about economic sphere: the prospects of improving a collective approach to policy-making. Some outcome documents of - elimination of structural obstacles Increasingly, political commentators the Russian G20 Summit: to growth (creating favorable are deploring the lack of efficient conditions for domestic and foreign global leadership and the inability of • a Leaders’ declaration investors; improving transparency multilateral institutions to work out • a statement concerning the and building confidence in the state and implement coordinated solutions fifth anniversary of G20, authorities; creating proper to urgent issues. • an Accountability Report on conditions for fair competition at the The G20 is on the brink of a G20 development national and international levels reputational crisis, since the global commitments including multilateral trade community had pinned its hopes on • the Saint Petersburg liberalization; making government the body as a potentially strong tool Development Outlook stimulus programs a priority to for democratizing international • documents on fighting create new jobs, including through relations, bridging the various corruption and improving tax the development of modern interests of developed and regulations, regional trade infrastructure); developing states, and adopting agreements, enhancing control legitimate solutions. This is why of the shadow banking system, - implementation of a balanced fiscal Russia’s G20 Presidency was not and financing of long-term strategy (finding a “golden mean” easy; it could not ride on the G20’s investment. between the needs to achieve a long- “coat tails.” Rather it had to term fiscal balance and to stimulate generate a new impetus that would One of the most significant decisions economic growth; working out help push the club forward. It was no was the agreement to extend the measures for budget deficit

stabilization and reduction of been and always will be certain ***

UPDATE excessive public debt; preventing tax difficulties with sticking to mutual Quite soon Russia will hand the base erosion, tax evasion and multilateral commitments at the baton of G20 Presidency to avoidance, etc.); international level, especially at Australia, but almost at the same G20 times of intensified domestic political time, it will assume the G8 - elimination of the causes of crises struggle, when a democratically Presidency. We deem this a positive and consolidation of the financial elected government has to make the development. sector as a reliable foundation for national agenda its top priority, often global economic development at the expense of pledges made to First, the topics and projects Russia

Reflections on the Summit (improving stability of separate other countries. It’s true. However has been working on as G20 financial institutions and national the numerous problems the President will be carried into the financial systems, which includes implementation of the Basel III New Capital and Liquidity Requirements and special control of systemically important institutions; extending the cross-border regulatory base on the shadow banking system; reforming the OTC derivatives market; adopting measures to increase transparency and competition in the credit ratings market; improving financial accountability standards, etc.);

- promotion of “development for all” (providing food security; making infrastructure development a priority; strengthening ﬁnancial inclusion, in particular reducing the cost of money transfers to the Copyright by Andrew Tarasov

Due to Russia’s “contiguous” “elite” club of developed states. The centripetal forces for presidencies, the voices of Programs that are currently no more international cooperation developing countries will be than general drafts (in particular, should eventually dominate heard loudly in the G8 process, those on promoting investment), will over the centrifugal forces in a way which is be turned into road maps and specific which drive countries apart in unprecedented. action plans to promote global pursuit of their narrowly economic growth. interpreted national interests. globalized world has to face are still there – e.g., development of the Secondly, due to Russia’s developing countries; promoting poorest states, environmental issues “contiguous” presidencies, the inclusive green growth; etc.). in many regions of the world or voices of developing countries will be attempts of profit-making heard loudly in the G8 process, in a And of course the Summit did not organizations to evade taxes and way which is unprecedented and overlook the most pressing issue on avoid financial control. Finding gives new impetus to mutually the global economic agenda – the effective solutions to all these issues beneficial international cooperation extent of coordination among is beneficial for all states without based on principles of equal country authorities of domestic exception and, therefore, it calls for partnership. monetary policies and other stimulus immediate response and support at measures. The Saint Petersburg the highest levels of cooperation. And thirdly, it is highly probable that Declaration reads, “We commit to The centripetal forces for interaction and perhaps even rivalry cooperate to ensure that policies international cooperation should between these two international implemented to support domestic eventually dominate over the processes – the G20 and the G8 -- growth also support global growth centrifugal forces which drive can be enhanced, to the absolute and financial stability and to manage countries apart in pursuit of their advantage of the entire global their spillovers on other countries”. narrowly interpreted national community. interests. Ideologically, this dynamic Does this mean that this thorny issue was the invisible focus of the Russian has been resolved once and for all? G20 Presidency. Naturally, no. There always have

Building on mixed success – from St Petersburg UPDATE

2013 to Brisbane 2014 G20

By Nancy Waites, Head of Policy Research & Government Relations, World Vision Australia Reﬂections on the Summit

CC BY 2.0 (Nicolas Raymond)

There’s no doubt that the St was provided, many of the people Another significant breakthrough Petersburg G20 Summit was run who received media accreditation was Leaders’ acknowledgement that with an impressive level of efficiency were unable to attend and this strong, sustained, balanced growth is and professionalism. From the limited the NGO presence at the insufficient; it must be inclusive as regular shuttle buses and ferries that Summit to around 20 at most, with well. This was the central theme of seamlessly conveyed journalists to Southern representation particularly the Civil G20 Taskforce on Equity the media centre to the G20 logo lacking. and was visible in the official G20 emblazoned plates in the free and declaration where Leaders lavish restaurant, every detail had No opportunities were emphasized that “[t]he G20 must been anticipated. Apart from a provided for civil society strive not only for strong, sustainable failure to break the deadlock on representatives to meet with and balanced growth but also for a Syria, the Summit seems to have Leaders or even sherpas. more inclusive pattern of growth that come off without a hitch even will better mobilize the talents of achieving some notable policy It was a shame that key participants our entire populations.” outcomes, especially in terms of tax in the Civil G20 policy process were transparency. unable to attend because the Summit There was progress on the generated some positive policy issue of tax transparency, However, from a civil society outcomes that reflected which was a particular focus of perspective, the smooth event recommendations from some of the the Civil G20 thematic group management had one significant flaw Civil G20 thematic groups. on anti-corruption. – lack of civil society participation. Civil society representatives were Notably, there was progress on the not invited to participate in the issue of tax transparency, which was While the G20 could have taken Friday morning meeting between a particular focus of the Civil G20 more decisive action to tackle Leaders and “social partners,” thematic group on anti-corruption. inequality, “inclusive growth which only included representatives The St. Petersburg Summit saw continued to be a theme in Leaders’ from the B20 and L20. Indeed, no continued momentum on combatting work on jobs and employment. opportunities were provided for civil tax avoidance with G20 Leaders Leaders’ recognized that job society representatives to meet with agreeing to implement “automatic creation should be a priority of Leaders or even sherpas. In fact, exchange of tax information” stimulus programs, particularly for civil society access to the Summit between their countries by the end of the vulnerable (e.g., disadvantaged media centre had not even been 2015. G20 Leaders also endorsed groups, particularly women, youth, originally envisaged by the Russian the OECD’s action plan to stop people with disabilities and the long- organizers and was only granted to profit-shifting by international term unemployed). selected Civil G20 representatives companies, although as Oxfam notes, after lobbying by civil society they did not designate a process for The Summit also saw the release of representatives at the Civil G20 developing countries to engage in the the St Petersburg Development Summit in June. As no travel support negotiations of new tax rules. Outlook, the much-awaited successor

to the G20 Development Working Minister’s participation impossible Think 20), including by appointing

UPDATE Group’s (DWG) Multi-Year Action and, instead, he sent his Foreign steering committees for each of Plan from the 2010 Korea Summit. Minister, Senator Bob Carr as his these outreach groups. Most of the The Outlook attempts to sharpen the proxy. groups have shown strong interest in G20 focus of the group’s activity by identifying issues for policy identifying four long-term outcomes: Another negative consequence of the development with the G20. The quality jobs and investment, trust and timing conﬂict between the Australian Think 20 (T20) convenor, transparency, sustainability and Australian election and the Summit the Lowy Institute’s G20 Studies resilience, and social inclusiveness; was the low Australian media Centre, has already hosted two

Reflections on the Summit and five core priorities: food presence; only four Australian roundtables with representatives security, financial inclusion and journalists attended the Summit from government and outreach remittances, infrastructure, human while the majority stayed home to partner groups to begin the policy- resource development, and domestic cover the election. It looked as if the related conversation. These policy resource mobilisation. However, the Summit might be completely ignored roundtables will be a feature of the Outlook is not clear about the by the Australian media until the T20’s program throughout the relationship between the announcement by one of the major Australian presidency. “outcomes” and “priorities” or Australian political parties on the which will be used to monitor and first day of the Summit that, if Policy roundtables will be a evaluate the DWG’s effectiveness. elected, it would make deep cuts in feature of the T20’s program Without greater clarity about these overseas aid. Ironically, this throughout the Australian questions, it may be difficult to hold announcement put the G20 Summit presidency. the DWG to account. on the radar screen of the general Australian public because it drew a heated response from World Vision Building on the precedent set by the The Outlook recognizes the Australia CEO, Tim Costello, who Russian Civil G20 process, the need to strengthen dialogue was in attendance at the Leaders’ Australian presidency will further with civil society as key Summit. Mr Costello’s many institutionalise the C20 in the G20 partners in development. interviews with Australian-based architecture. Earlier this year the Further, the commitment to media back home helped to bring the Government appointed a C20 promote policy coherence Summit to the consciousness of the Steering Committee of Australian between G20 financial, general Australian public. civil society representatives, chaired economic and development by Tim Costello, to develop a process policies is a welcome step to facilitate effective and productive forward. Earlier this year the engagement between civil society Government appointed a C20 and the G20 throughout the On the positive side, however, the Steering Committee of Australian presidency. Outlook recognizes the need to Australian civil society strengthen dialogue with civil society representatives, chaired by The Australian elections, held as key partners in development. Tim Costello, to develop a the day after the Russian G20 Further, the commitment to promote process to facilitate effective Summit, led to a change of policy coherence between G20 and productive engagement government and the financial, economic and development between civil society and the appointment of a new Prime policies is a welcome step forward. G20 throughout the Australian Minister, Tony Abbott. presidency. In sum, given the relatively low The Committee met in July and mid- expectations, it appears that the St. The lack of Australian high-level September this year to discuss the Petersburg Summit has delivered political participation or significant outcomes of the G20 Leaders more than expected – Syria media presence in St. Petersburg Summit in St Petersburg and the key notwithstanding. Now the focus has does not indicate that the lessons learned from the Russian started to shift to the Australian G20 Government has not prepared to Civil G20 precedent. Two Committee Presidency, which commences on assume the G20 presidency. To the members, Tim Costello and December 1, 2013. contrary, the Government’s G20 Cassandra Goldie (CEO of Taskforce, which is headquartered in Australia’s national platform for With Australia set to take up the the Department of the Prime social services) attended the St. baton so soon, it was particularly Minister and Cabinet, has worked for Petersburg Summit, where they met unfortunate that Australia was not over a year to prepare for the with the Russian Civil G20 represented by its leader at St Australian G20 Summit on secretariat and also heard the views Petersburg. The former Prime November 15-16, 2014. It has also of other international civil society Minister, Kevin Rudd, had chosen to embarked on a highly collaborative members regarding the Russian Civil call national elections for 7 approach to working with the official G20 process and their September, the day after the outreach partners (i.e., Civil 20, recommendations for the Australian Leaders’ Summit concluded. This Business 20, Labor 20, Youth 20 and C20. The Committee is aiming to effectively made the Prime accelerate its preparations as we 7

embark upon the transition from the G20 are being delayed, such as understands the value that civil Russian to the Australian ﬁnalizing Australia’s priorities for its society has brought to past G20 UPDATE Presidency, however, the domestic presidency and maintaining the presidencies and that it can bring to political context is currently momentum of the Summit Australia’s. Because there is already G20 somewhat challenging. preparation process. Importantly, it much goodwill between the C20 and is unclear how engaged the new the other outreach partners, we hope The Australian elections, held the Government will be in outreach to its that, collectively, we will persuade day after the Russian G20 Summit, G20 partners. the Government that we can add led to a change of government and considerable value to G20 policy

Reﬂections on the Summit the appointment of a new Prime It will be vital, therefore, that the development and, ultimately, to the Minister, Tony Abbott. As the new Australian C20 Steering Committee success of Australia’s G20 Government focuses on establishing work with other G20 partners to presidency. its ministries and assuming its ensure that the new Government powers, important decisions on the puts a high priority on the G20 and

MUST READ

News from “Down Under”

In her July 2013 speech – “G20 opportunities for national and subnational ETS schemes, but as Australia” -- Australian Green Party Senator Europe moves to reform its ETS, it staggers under Christine Milne states that the G20 should no longer the knowledge that the Australian government was be a “gated community.” Rather, it should toppled, in part, to torpedo the ETS. challenge the disconnection between social and environmental crises (e.g., global warming), on the “Development and the G20”, Lowy Institute, G20 one hand, and economic and financial crises, on the Monitor No. 5 (August 2013). As a former other. She states that “action to decouple business representative on the G20’s Development Working and economic growth from resource intensity and Group, Robin Davies (Australian National environmental impact has never been more critical University) calls the G20’s development agenda to the long-term success of business.” During the “invertebrate, flabby, and toothless”…“diffuse, Mexican G20 Presidency, Milne states that lacking a coherent narrative, and disconnected from “inclusive, green growth” was placed on the the central concerns of G20 leaders and finance agenda, but the priority has withered. She calls ministers.” Davies says that, to date, G20 efforts for Australia to revive a focus on food security and have focused on food security and financial re-commit to the removal of fossil fuel subsidies and inclusion; in the future, it should a) advance the provide leadership for other G20 countries to follow stalled infrastructure agenda; b) balance its work suit. This requires dropping the call for “inefficient” on social security, in general, and food security, in subsidies, since this had led to a situation in which particular; and c) address financing for countries simply prove that their subsidies are development. The G20 should work closely with efficient. Least Developed Countries and advance coordinated work by either international organizations or by Alone in the World, Dave Keating, European Voice, (subsets of) the G20 that can make a difference. September 20, 2013. This article describes how Susan Harris Rimmer (Australian National the recent election in Australia could put the final University) highlights the lack of attention to “nail in the coffin” of the European Union’s gender in economic strategies and the lack of Emission Trading Scheme (ETS). Australia has the women’s representation in G20. The G20 should only other national ETS, which was set up by its remedy this and monitor the economic implications Labor party, which was toppled when, in of the G20’s core actions in fiscal, financial, trade, September, voters elected Tony Abbott of the exchange rate and environmental policies for non- Liberal Party. In Abbott’s campaign, he derided G20 countries, especially Low-Income Countries. the concept of an ETS as trying to form “a so-called Its future lies in policy coherence in areas ’beyond market for the non-delivery of an invisible substance aid’ (e.g., trade facilitation, labor mobility, gender to no one." Now, as Prime Minister, he aims to equality, climate finance, migration, technology). deliver on his promise to abolish (not “rebadge” or “rename”) the carbon tax. There are other nascent

The G20 St. Petersburg Summit – Bubbles, UPDATE

G20 Casinos and Inactivity

By Sameer Dossani, Advocacy Coordinator, Reshaping Global Power, ActionAid International Reﬂections on the Summit

CC BY-SA 2.0 (DonkeyHotey)

While much of the media coverage But focusing on growth is a bit like from free money to consumers, around the G20 leaders summit has treating strep throat with aspirin. investors have been looking for bets been about the failure of You may alleviate some of the that will ensure both security international diplomacy in Syria, the symptoms, but you’re not treating (investors know that another crisis formal agenda was around one issue: the source of the problem. could be around the corner) and high growth. Growth through jobs, growth returns. They thought that through transparency, and growth Whatever cure the global economy commodity markets fit the bill in through effective regulation – these needs must address the structural 2008-2010, but, as a result, the were the three themes the Russian problems which have led to the inflow of money into these markets government prioritized for this year’s current crisis. Diverse as they may caused havoc for consumers, summit. be, those structural problems all especially poor consumers who found have the same root – an economic themselves paying more for food The formal agenda was around system that prioritizes the interests without any increase in wages. one issue: growth. Growth of global capital over the needs and Bread riots not seen for a generation through jobs, growth through rights of ordinary people. returned. transparency, and growth through effective regulation. Despite the overemphasis on growth, Focusing on growth is a bit like G20 governments have considered treating strep throat with One could perhaps argue that the reforms – such as ending “too big to aspirin. You may alleviate some obsession with growth is appropriate. fail”, substantial reform of the of the symptoms, but you’re The US economy – the source of the international monetary system, and not treating the source of the largest financial crisis since the cracking down on corporate tax problem. Great Depression – is again growing, dodgers – that could address the root but when compared with previous causes of crisis. But to date, there When that bubble deflated in 2010 economic recoveries the pace of has been little to no implementation money flowed out of commodities growth has been extremely sluggish. of those reforms. and towards the emerging markets Economists estimate that at the of Brazil, South Africa, India, China, current rates of growth and job The Bubble Casino’s Latest Bust Indonesia, Turkey and a few others. creation, the US will not achieve But now that QE is winding down, anything close to full employment Failing any change in the underlying money has already started moving before 2022. Most G8 economies – structure, investors have been back to Northern markets where it especially in Europe – are in worse playing a game with free money, can again be profitable without the shape and even China and India are largely provided by governments risks involved in developing seeing diminished growth prospects. engaged in monetary stimulus countries. (Quantitative Easing or QE in the US). Instead of passing on the gains

We don’t yet know the full effect of one aspect of this problem – namely, airports, not to mention schools,

UPDATE this latest shift. Currency markets in the global over-reliance on the US hospitals, clean water – there’s no South Africa, Brazil, India, Turkey dollar. limit to what tax can pay for. And and Indonesia seem be stabilizing politicians who don’t use taxpayer G20 after losing as much as 25% of their Currency markets in South money to fund better infrastructure, value against the US dollar over the Africa, Brazil, India, Turkey social services and jobs are likely to past year. A replay of the 1997 and Indonesia seem be find themselves out of work after the Asian financial crisis is unlikely. stabilizing after losing as much next election cycle. A little bit in Many countries are in a good as 25% of their value against increased tax revenue can go a long Reflections on the Summit situation because they have the US dollar over the past way to addressing a lack of social stockpiled foreign currency reserves year. services and an inability to and taken out few foreign currency- implement a strong strategy for denominated loans. But in an While these solutions would not stop universal and good quality integrated global market, falling the bubble casino from operating, employment. currency values mean rising prices; they may at least slow it down a in some countries, food, fuel and little. But too many avoid paying taxes. other essential items are already Through a complex network of more expensive. Tax and Ending the reign of the treaties, companies list income robber banker generated in one country as income Instead of passing on the gains generated in another, thereby from free money to consumers, Over the past few years, our allowing themselves to pay tax (or investors have been looking for economic system has punished the not) in places that have little or no bets that will ensure both innocent and rewarded the guilty. corporate taxation and where they security (investors know that But believe it or not, that’s not its don’t have to disclose financial another crisis could be around most troubling feature. information. the corner) and high returns. If the G20 really was a “board To its credit, this year’s G20 summit If the G20 really was a “board of of directors” of the global endorsed a plan drafted by the OECD directors” of the global economy, economy, they would have left (Organization for Economic they would have left St. Petersburg St. Petersburg with a solution Cooperation and Development) to with a solution to this latest crisis if to this latest crisis if not the address the issue of Base Erosion not the underlying trend. But the underlying trend. and Profit Shifting (BEPS). (See G20 isn’t that. It’s a forum for box: “What is the Action Plan on discussions, not a rapid-response Globally the richest 0.6% of the BEPS?”) The summit communiqué mechanism (nor, really, even a slow population controls a little less than includes strong language on the need response mechanism most of the 40% of global wealth, meaning that to address the interests of developing time). Except in times of deep crisis the Occupy Wall Street movement countries in the next steps. But (March 2009), it requests studies, was being optimistic when they developing countries need to be at deliberates through its finance coined their slogan “We Are The the table and it’s not clear whether ministries, and sometimes reaches 99%”. or not they will be. sufficient consensus to recommend policy changes or new processes to Globally the richest 0.6% of the Potentially, BEPS is a once-in- get agreement on policy changes. population controls a little less a-lifetime opportunity. A single Instead of decisive change, the St. than 40% of global wealth. process could alter thousands Petersburg communiqué refers to a of tax treaties, and political perceived need to “carefully Of the reforms on the table, there pressure to adhere to stronger calibrate and clearly communicate” are a few that might actually work in regulations could become the economic policy between countries. terms of taking power away from the norm. The outcome is particularly tiny elite who continue to profit from Potentially, BEPS is a once-in-a- unsatisfactory given that the G20 has this unsustainable system. Many of lifetime opportunity. A single process been obsessed with one issue – these relate to tax. sometimes under the misleading could alter thousands of tax treaties, and political pressure to adhere to label “currency wars” – since 2010. Tax gets a bad name for obvious stronger regulations could become reasons, but at its core, tax is one the norm. Together with new And there are solutions on the table. idea that might get us out of our initiatives on “automatic exchange From UNCTAD’s proposal to peg global predicament. It goes after of tax information”, these measures exchange rates to inflation to the wealth – that is, in a progressive could finally compel companies to proposals related to use of a neutral system, the wealthy pay a greater pay what they owe in countries that currency, such as the IMF’s Special share – which is used to pay for they work in, and everyone could at Drawing Rights, there are a range of “public goods” or things that options which would address at least everybody needs. Bridges, highways,

last reap some beneﬁt (not just the of what was once called the Tobin such a tax, despite recent

UPDATE banksters). Tax or the Financial Transactions controversy regarding the legality of Tax, the Robin Hood Tax would such a move. If those countries are But even these measures do not go impose a small fee on the bold they will suggest a higher rate – G20 far enough considering the extremes international transactions that make at least the 0.5% that economist of poverty and wealth that pervade up the vast majority of commerce in James Tobin originally suggested. At the global economy. Another today’s world. The money generated lower rates the tax would still proposal that’s gotten a lot of would be signiﬁcant – hundreds of generate a lot of revenue, but it’s not attention over the past few years is billions of dollars. 11 EU countries clear that it would do anything to

Reﬂections on the Summit the Robin Hood Tax. A re-branding are considering going forward with slow down the casino.

What is the “Action Plan” on “Base Erosion and Proﬁt Shifting” (BEPS)? Will it Curb Tax Avoidance and Evasion?

The Russian G20 Summit endorsed the July 2013 The G20 and the OECD have poor records with Action Plan on Base Erosion and Profit Shifting regard to developing rules in an inclusive manner (BEPS) of the Organization for Economic or enforcing them. In addition, the Plan is Cooperation and Development (OECD). This Plan incomplete without implementation of related seeks to change tax rules in order to stop pledges, e.g., those on “automatic disclosure of multinational corporations (MNCs) from shifting tax information” and “beneficial ownership.” their profits to low- or no-tax jurisdictions and, instead, require them to pay In its publication “Fixing the taxes to the countries Cracks in Tax: a Plan of where they do business. Action and Joint Since MNCs represent such recommendations to the a large fraction of global G20 and OECD for tackling GDP, the “shell game” of base erosion and profit hiding and shifting profits shifting,” Christian Aid (including among their (UK) urges the OECD and subsidiaries) harms the G20 to: invite governments and citizens developing countries to because their corporate tax participate in the BEPS base erodes. As a result, project on an equal footing; governments sacrifice their strengthen the UN tax capacity to make productive committee; tackle financial investments and meet their and corporate secrecy; and “social contract” with analyze the impact of citizens. Citizens also pay a potential tax policies on price because their tax developing countries, among burden increases to other things. compensate for lost Source OECD corporate taxes. Domestic To learn more about tax corporations suffer because abuses, see ActionAid’s they lose the capacity to “The SABMiller Guide to compete with MNCs that Tax Dodging” and Oxfam’s escape taxation. “G20 Must Act on Tax Dodging Draining Poor Countries” or material by Tax Justice Network The Action Plan sets forth 15 actions to curb and Global Financial Integrity. MNC abuses. However, there are many barriers to strengthening and implementing these actions:

Reflections from the 2013 Russian G20 Summit UPDATE

By Michael Switow – a Singapore-based writer, producer and anti-poverty campaigner who serves

G20 on the Global Council of the Global Call to Action Against Poverty (GCAP), is co-founder of ONE (SINGAPORE) and supports the Feminist Task Force. Reﬂections on the Summit

CC BY-SA 2.0 (Dilma Rousseff)

The 2013 G20 Summit was 1. The G20's Development Focus Mexico, Philippines and Nigeria top overshadowed by issues of war and This year the G20 adopted a new St. the list.) peace (Syria) and politics (Obama Petersburg Development Outlook to vs. Putin and how long did that replace the 2010 Seoul Development Migrants officially sent home some handshake last?). But, the event is Action Plan. The official summit US$540 billion in 2012, according preceded by months of intense effort communique not only endorses the to OECD and World Bank data, and by diplomats and technocrats to craft new document, it instructs the possibly another US$250 billion new policies and negotiate the Development Working Group to through unofficial channels. (An details. Then, in the final hours of focus on fewer key areas, namely: online German magazine has the Summit, as the official produced a great interactive graphic communiques and annexes come •food security; that shows global and country- pouring out, reporters scramble to •financial inclusion and remittances; specific data.) meet deadlines and a handful of civil •infrastructure; society analysts race to provide •human resource development; and “Infrastructure” is one of the instant feedback to the media, which •domestic resource mobilisation. G20's favourite words. It is largely focused on headlines, not appears more than twenty development issues. Notably, the communique also times in the official commits the G20 to adopt “a communique and receives Just about every year, there's some forward accountability process to another sixteen mentions in the big issue that 'overshadows' the G20 improve monitoring and coordination St. Petersburg Development Summit: the euro crisis (Mexico), and ensure greater transparency.” Outlook. Greece's debt referendum (France), large expenditures on security and This year the G20 adopted a But the cost of financial remittances the threat of violent protests new St. Petersburg is a huge issue. Next year, the G20 (Canada) . . . this year it was Syria. Development Outlook to has pledged to consider “results- replace the 2010 Seoul based mechanisms” to reduce the However, there are a number of G20 Development Action Plan. cost of remittances to developing policies that are relevant to countries. On the face of it, this is a development practitioners, civil 2. Remittances positive step. But the G20 actually society activists, and people and Some 175 million women and men went further than this at the 2011 communities across the globe. Here travel overseas to work as migrant French Summit, when it pledged to are some key issues, lessons and labourers and domestic workers. reduce the average cost of reflections from this year's summit The money they send home fuels remittances in half from 10% to 5% and counter-summit . . . household consumption and is a huge by 2014. source of revenue for many developing countries. (India, China,

The G20 noted that this action would The G20 didn't listen though. policies must focus on smallholder

UPDATE save migrant workers an additional Instead, the communique says that and family farmers, with a particular US$15 billion. But, the G20's St. “particular attention” will be given emphasis on “gender equality and Petersburg Accountability Report to ways to improve PPPs. women empowerment”. However, G20 notes that the G20 is ‘off-track’ on Unfortunately, we know too many aside from conducting a review of this goal, saying that ”some instances in which these private “critical opportunities” by March implementation has been achieved, sector partnerships increase project 2014, there are no new actions in but progress is slow.” costs (rather than simply mobilising this area. funds) and raise the prices of Reflections on the Summit 3. Infrastructure essential services -- everything from “Tax havens and transfer “Infrastructure” is one of the G20's fuel to water -- for local pricing schemes are kept in favourite words. It appears more communities. Civil society could do place by a complex network of than twenty times in the official more to sharpen its advocacy treaties backed up by armies communique and receives another messages and programs on this topic of lawyers. The BEPS process sixteen mentions in the St. to change government policies. On could lead to the revision of Petersburg Development Outlook. the bright side, though, there's literally thousands of those “Infrastructure is a key driver of evidence that the G20's treaties at once.” economic growth,” notes the infrastructure programs are more Sameer Dossani communique, and “the lack of talk than action (see this analysis by appropriate [sustainable] the Lowy Institute). "The G20 must address the gender infrastructure impedes a country's gap. Women are drivers of economic competitiveness, productivity . . . and 4. Gender development and social progress," participation in the global economy.” Did you hear the one about women notes my colleague Rosa Lizarde of who shop a lot? the Feminist Task Force. "It should Apparently, Russian Finance establish a G20 task force on gender Minister Anton Siluanov On the positive side, the G20 equality and follow-up on the 2012 thought it was appropriate to notes that nutrition and food Los Cabos G20 Declaration, which joke about women in an security policies must focus promises concrete actions to official G20 media briefing. In on smallholder and family integrate gender into the G20 a discussion about financial farmers, with a particular agenda and realise women's full inclusion, Siluanov said that emphasis on “gender equality economic and social participation." “women consume a lot, so and women empowerment”. they need help with their And no more jokes. The financial management". Apparently, Russian Finance feminisation of poverty is not a Minister Anton Siluanov thought it laughing matter. was appropriate to joke about The G20 does not see or women in an official G20 media 5. Tax Avoidance acknowledge that new infrastructure briefing. In a discussion about Of course, in order to gauge the projects need to be developed in financial inclusion, Siluanov said that G20's impact, we need to look collaboration with local communities “women consume a lot, so they need beyond its development focus. One to fuel local development, not just as help with their financial of the biggest policy changes coming a tool to facilitate the export of management". out of this years' summit is related to natural resources and other products, tax avoidance. which could fuel under-development Seriously??? At a summit where and impoverishment instead. women are largely absent – and Remember the recent story about where the communiques hardly Apple diverting profits to Ireland to At the G20 Civil Summit in June, mention gender – Siluanov’s quip is avoid paying taxes? Developing Nancy Alexander (Heinrich Boell insightful. Unlike 'infrastructure', countries routinely lose out as Foundation-North America) the G20 does not count 'women' or businesses shift profits from one facilitated a discussion about G20 'gender' among its favourite terms. country to another. The Tax Justice infrastructure policy with The St. Petersburg Development Network estimates that corporate representatives of the Business 20, Outlook mentions women just twice tax avoidance costs developing development banks and civil society. and gender only once. The countries between US$120 – 160 A primary recommendation was for communique is slightly better with billion a year. To address this, the the G20 to drop its bias in favour of six mentions, but most of these are G20 is calling for action on Public Private Partnerships (PPP). references to reports by other something called the “BEPS Action Even the business leaders agreed. organisations, particularly the OECD Plan” (Base Erosion and Profit While they generally see value in and INFE (International Network Sharing) to ‘ensure that profits are PPPs, they do not think it has to be for Financial Education). taxed where economic activities the primary method to fund projects. On the positive side, the G20 notes occur and value is created.’ (See box that nutrition and food security on BEPS, page 11.) In addition to

reviewing rules on tax treaties and 6. Advocacy and Communications those responsible to be brought to UPDATE transfer pricing, the G20 calls for a Before going to this year's summit, it justice before the International new global tax standard requiring was clear that Syria would dominate Criminal Court. G20 the “automatic exchange of tax media coverage. But when the topic information” between countries. of the day seems removed from the By responding to this issue, I found key messages you planned to share we also had more opportunities to “As far as tax justice goes, this is at the G20, what do you do? talk about poverty eradication, potentially huge because it could inequality, gender, taxes,

Reﬂections on the Summit generate income for developing We spoke out strongly against infrastructure and development. countries to invest in public services the proposed bombing. We During the course of an interview, and infrastructure and reduce also criticized the use of after talking ﬁrst about Syria, dependency on aid,” notes Sameer chemical weapons and called journalists would often ask for Dossani, Advocacy Coordinator at for those responsible to be insights on other topics related to the ActionAid, which has published a brought to justice before the summit. (For an example, have a great 2-page FAQ on the issue. International Criminal Court. listen to this interview with Channel “Tax havens and transfer pricing Africa.) schemes are kept in place by a I discussed this issue with a number complex network of treaties backed of GCAP colleagues prior to the (Portions of this article were up by armies of lawyers. The BEPS Summit and, for us, the answer was previously published in media process could lead to the revision of clear. We had to address Syria too. releases from the G20 Summit, literally thousands of those treaties Not because it was the media's published by GCAP in at once.” focus, but because, in every aspect of collaboration with the Asia our work, we know that peace and Development Alliance (ADA) and Keep an eye on this topic. human security are intricately linked Feminist Task Force (FTF). For an Developing nations – and not just the to development. One is impossible overview of these documents as G20 countries – should have a role in without the other. And so we spoke well as other civil society analysis, developing new tax rules to ensure out strongly against the proposed please check out this 2013 G20 that their needs are met and not just bombing. We also criticized the use Overview on the GCAP website.) those of the rich countries. But this of chemical weapons and called for is potentially big news.

MUST READ NEW THINK TANK PUBLICATIONS In “Think Tank 20 – The G20 and Central Banks in support global economic growth. Thomas Bernes the New World of Unconventional Monetary Policy” comments on the IMF quota and governance reform. by the Brookings Institution, essays on the monetary Susan Schadler discusses sovereign debt policy of each G20 member country address three management. Barry Carin analyses the development debates related to: a) the limits and consequences of agenda within the G20. Finally, Gordon Smith accommodative fiscal and monetary policies; b) how assesses that the political dimensions of the Russian habituation to such policies causes “moral hosting of the G20’s September meeting. hazard” (which contributed to the crisis in the first place) and the need for a “new normal” for central In “Instituting Economic Cooperation in a Non- banks and monetary policy; and c) the hostile Cooperative World,” Adam Hersh, Center for political environment for structural reforms (e.g., American Progress, points out that China and the policies related to budgets, financial markets, energy U.S. are responsible for 38 percent of the total G-20 pricing and subsidy reform, income distribution and current account imbalance. He urges the G20 to labor markets). recognize the structural causes of imbalances and their role in rising levels of inequality in growth, In the report “Priorities for the G20 – The St. income, and employment. He suggests that the U.S. Petersburg Summit and Beyond,” (Center for do its part in achieving governance reforms, for International Governance Innovation (CIGI)) reflects instance in the international financial institutions and on G20 priorities, particularly as they relate to call for G20 member countries to engage in peer macroeconomic cooperation, sovereign debt reviews of their policies; establish G20 membership management systems and stimulating international criteria; promote China as the G20 host in 2016; development. Domenico Lombardi, Director of complete financial regulatory reform; and improve CIGI's Global Economy Program, provides a preview dispute-settlement mechanisms in the WTO and of the summit. Paul Jenkins addresses the international economic institutions. importance of unconventional monetary policy so to

UPDATE

Must Read MUST READ G20

INSIGHTS ON THE BRICS

In “Neoliberalism with Southern Characteristics: toward launching a BRICS-led ‘New The Rise of the BRICS” (Rosa Luxemburg Development Bank’ and Contingent Reserve Foundation), Vijay Prashad of Trinity College Arrangement (CRA). But, Bond points out that (Connecticut) puts the emergence of the BRICS the anticipated $50 billion capitalization of the in an historical perspective that includes the eras Bank is pitiable compared to the size of existing of colonialism and the failure of the Third World development banks, particularly the Brazilian Project (1928-1983). Wearing technocratic National Economic and Social Development (rather than political) masks, neoliberalism Bank (BNDES). Likewise, a $100 billion for the triumphed and sharply diminished the role for the CRA could be trivial compared to the potential state. The BRICS are not transforming global costs of a serious financial meltdown. power relations or neoliberalism, but only seeking to join and modify global governance. Still, this In “Why is the Indian Rupee Deteriorating?” challenges the “hub and spokes” model of global Kavaljit Singh (Madhyam Briefing Paper), governance (wherein the U.S. is the “hub”) and describes the plans of the U.S. Federal Reserve creates a multi- to taper (or polar world. gradually Moreover, “an curtail) its aggressive move monetary to transfer the stimulus surpluses of the program of South to their bond-buying. own populations Due to this alongside shifts in program (known the growth as “quantitative model…would easing” (QE)), have an investors have immediate impact borrowed cheap on the CC BY-NC-SA 2.0 (Blog do Planalto) money in the possibilities of an U.S. and institution, such as invested in higher the BRICS Bank.” yielding assets in emerging market economies. Among others, India used these inflows to finance In Are BRICS Any Use For Rebuilding the its trade and current account deficits rather than Collapsing Global Financial Architecture? addressing their underlying structural causes. (ZNet), Patrick Bond, Director of the Centre for Just the Fed’s suggestion of the need to taper Civil Society of the University of KwaZulu-Natal (rather than the actual tapering) has led to in Durban, South Africa, describes the currency capital flight out of emerging markets and sharp crashes in emerging market countries and quotes depreciations of currencies, particularly the assertions that the BRICS are already breaking Indian rupee. Singh describes a range of factors apart in material ways, leaving China to push that have affected the Indian economy and ahead. Bond also emphasizes how the ‘talk-left’ currency, such as a contraction in manufacturing of BRICS foreign policy officials is negated by the and mining; a sharp rise in domestic food prices; ‘walk-right’ behavior of BRICS finance officials rising global oil prices, and the role of speculation and central bankers. Due to this dynamic, the in derivative markets. Singh suggests that the BRICS are not challenging, much less stopping or Indian government consider policies, such as reversing, the ways in which the global financial curbing inessential imports, trading goods in local architecture is self-destructing. He also currencies, entering currency swap agreements anticipates the outcomes of the March 2014 with trading partners, reining in speculation, and BRICS Summit in Forteleza, Brazil where the imposing capital controls to protect the economy Leaders are expected to announce progress from capital flight.

UPDATE Impressum G20

Publisher Heinrich Böll Foundation Schumannstrasse 8, 10117 Berlin T 0049 30 285 34 - 0 E [email protected]

Editorial Team Nancy Alexander, Heinrich Böll Foundation Washington & Heike Löschmann, Heinrich Böll Foundation Berlin

Layout Roman Leskov, Russia

Translations Alexey Maganov, Russia Polina Maganova, Russia

Disclaimer The opinions expressed in this newsletter are those of the authors and not necessarily those of the Heinrich Böll Foundation

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