In the wake of the 2008 global financial crisis, the G-20 assumed a leadership role in addressing financial economic issues. This newly-empowered group helped give political backing to global efforts, many of them centered on the IMF, to arrest the crisis, to secure a durable recovery, and subsequently to deliver strong, sustainable and balanced growth.
We can look back over this short period to some significant accomplishments made possible through the cooperation of G-20 members, working together and with key multilateral institutions such as the IMF. Examples include the massive 2009 coordinated fiscal stimulus, the tripling of Fund resources—including new support for the poorest countries—and the strengthening of the global financial safety net through such innovations as the IMF’s Flexible Credit Line (FCL). These results demonstrated in high relief the potential gains from strong international collaboration.
Of course, some wondered whether G-20 members’ willingness to work together—that was so effective during the crisis—would fade away as the recovery arrived and challenges became more complex. The early evidence is that the cooperative spirit has endured.
Of course, cooperation requires persistence and commitment. In several areas, the seeds have been sown for ongoing dialogue and cooperation, even if countries’ diverse circumstances call for distinct policies in response.
With the accomplishments of the London and Pittsburgh Summits behind us, and with Toronto effectively looking toward Seoul for results across many fronts, the focus is turning to Korea—not just for concrete decisions, but also to demonstrate that the spirit of effective collaboration endures.
Thus, both expectations and risks are high, but so too is thepotential for success, and for a lasting legacy to be created.
Korea’s Role
Since becoming G-20 Chair, Korea has taken its responsibilities forward with impressive ambition and professionalism, evidencing a strong commitment to multilateralism and to the Asian region.
This was evident last week in Seoul, when I attended the G-20 Sherpas meeting, as part of the preparations for the November Seoul Leader’s Summit.
Already, these efforts are beginning to pay off. The G-20 has added political momentum to reform efforts currently underway in the IMF and elsewhere. Many complex issues have moved forward, including: coordinating exit policies, strengthening the global financial safety net, implementing the Framework for strong, sustainable and balanced growth, and reforming IMF governance. These and other issues are on the G-20 agenda—and they also will be a key focus for the IMF in the months ahead.
