G20 finance leaders meeting in Durban look set to achieve the first consensus agreement of SA’s G20 presidency, with officials working to hammer out compromises over language despite tensions over global trade, climate and tax issues.
The bloc’s finance ministers and central bank governors may succeed in agreeing on a formal communique when their third meeting of the year ends on Friday, even though doubts remain about whether G20 heads of government will pull off a communique at the leaders’ summit in November, which will close SA’s G20 presidency.
At least one G20 has ended without a communique in recent years amid global geopolitical tensions.
There is also some optimism in Durban that the US will take the G20 finance agenda forward when it takes over as next year’s president, despite concerns that the Trump administration’s aversion to global forums and institutions, as well as its mixed messages on SA’s G20, could see it use next year’s presidency to erode the G20’s prominence.
Treasury director-general Duncan Pieterse said as he opened this week’s meetings that he hoped they would end with a communique, rather than the chair’s statements, which are the default issued when G20 leaders cannot reach consensus.
Pieterse, who chairs the finance track’s drafting committee, said before the committee’s final meeting on Wednesday that it was on track to find consensus language that would enable compromise on a communique.
Global trade fragmentation was always an issue, and there were tensions over climate language as well over some of the tax language. And while insiders reported at earlier meetings that tensions were “the US versus the rest”, Pieterse said it was not the case this week as there was great diversity among the G20 countries in the room.
Reserve Bank governor Lesetja Kganyago said on Wednesday it looked as if there might be a communique. “The sense I have is that people would like to have something that we would say as the G20,” he said. It was often just a few sentences or a paragraph that prevented agreement.
There have been question marks over the US’s participation, especially after US media reported in May that the National Security Council had ordered US government agencies and departments to suspend work at all G20 conferences hosted by SA.
Finance track insiders reported earlier this year that the US was not attending any of the working groups. US treasury secretary Scott Bessent again gave the meeting a miss, after declining to attend February’s Cape Town meeting of the finance track. However, he did send treasury deputy secretary Michael Kaplan (equivalent to SA’s director-general). Pieterse said the US was well represented at this week’s committee meetings.
Kganyago told Business Day that US Federal Reserve chair Jerome Powell had already said in February he could not make it to the Durban meeting, but he sent Fed vice-chair Philip Jefferson.
Troika
Pieterse said SA would still be part of the “troika” of past, present and future G20 presidents next year and would help to take the agenda forward at the US meetings.
Though there has been talk of establishing a permanent secretariat that could ensure continuity, Pieterse said that all the working groups have co-chairs from the various G20 members helps to provide continuity.
One of the big issues for the finance track is to tackle the high cost of debt for many African countries. The expert panel, led by Trevor Manuel, is due to brief G20 finance ministers and central bank governors on Thursday on its findings so far.
There are also updates this week on the G20’s work to make multilateral development banks bigger and better so that they can do more to provide affordable development and infrastructure finance, as well as on global financial regulation and cross-border payments.
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