U.N. officials call for G20 Summit to focus on development for all people

08:10, November 10, 2010      

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As development still remains top agenda of international community, the upcoming G20 Summit in Seoul should focus on development for all the world's people, two U.N. senior officials said Tuesday.

This week's Summit in Seoul is a milestone as it is the first time that the G20 Summit has been held in the Asia Pacific region, now the emerging center of gravity for the world economy, where the dynamic economies of China and India are leading the global recovery, Noeleen Heyzer, Under-Secretary-General of the United Nations and Executive Secretary of the Economic and Social Commission for Asia and the Pacific (ESCAP) and Dr. Nagesh Kumar, Chief Economist of ESCAP said in an e-mail article to Xinhua.

However, the Seoul Summit is also to be recognized for placing development on the G20 agenda. United Nations Secretary-General Ban Ki-moon will lead the Summit's discussion on development and include the opinions of those countries and the voices of billions of the world's population -- not represented by the G20 leaders at this critical forum, they said.

Under the auspices of the United Nations Economic and Social Commission for Asia and the Pacific, economists and representatives of 26 Asian countries gathered last week in Bangkok to reflect on the agenda of the Seoul Summit from the perspective of excluded poorer countries.

They noted that challenges that the G20 leaders will confront include the need to consolidate the momentum of global economic recovery especially in view of this recovery's fragile and uneven nature. The winding down of fiscal stimuli should be considered very cautiously in view of the continuing risks of a double dip recession. Concerns were raised by representatives of the smaller countries regarding policies adopted in advanced countries that are leading to massive short-term capital outflows to emerging market economies with consequences such asset price bubbles, inflationary pressures and exchange rate appreciation with highly disruptive effects.

Both suggest that G20 leaders support the use of capital controls when needed by the affected countries. Another threat to recovery is from possible currency wars and protectionism in the developed countries that should be shunned at all costs.

The declining demand in the western world as they unwind the fiscal and current account imbalances poses a new medium-term challenge for sustaining the dynamism of Asia-Pacific economies. With 950 million people living in poverty and with wide development gaps between and within countries, there is considerable headroom for generation of aggregate demand with through inclusive policies.

The challenge thrown up by the financial crisis in terms of diminishing aggregate demand can be turned into an opportunity for promoting inclusive development. Poverty reduction should no more be seen as a social welfare scheme but a critical part of the strategy to promote growth itself, they said.

They also called on G20 leaders to give a clear and strong message that achievement of the Millennium Development Goals, narrowing development gaps and other policies to foster balanced development have to now occupy a central place in sustaining growth in a post-crisis world.

Specifically, the latent potential of the poor to generate aggregate demand can be harnessed through promoting agriculture and rural development, strengthening social protection, enhancing financial inclusion, and promoting job creation among other policies within the emerging markets and among the excluded and poorer countries, they said.

Finally, the crisis has highlighted the long pending agenda of reform of international financial architecture. These include reform of IMF conditionalities, creation of a global reserve currency based on special drawing rights that can be issued in a countercyclical manner, and enhanced voice and quota of developing countries in the Bretton Woods Institutions for addressing the democratic deficit are high on the agenda to restore the legitimacy, effectiveness and development-friendliness of the international financial system.

To sum up, the G20 Summit has many challenges to address. However, with the changing economic geography and the rise of emerging market countries as growth poles of the world economy, the entire world economy has a stake in sustaining their dynamism.

Hence, development becomes a key issue on the agenda. The new thinking in the post-crisis world is that the achievement of the Millennium Development Goals and the narrowing of development gaps have a central place in achieving strong, sustainable and balanced growth. In this respect, the United Nations and of the leaders of 20 nations should work together to seek a better future for all nations, and for all the world's people.

Source: Xinhua


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