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Analysis

A Significant Short-Term Success:
Promising Prospects for the G20 Riyadh Summit

John Kirton, G20 Research Group
November 18, 2020

The G20 Riyadh Summit on November 21-22 will be a significant short-term success.

Performance

In their short time together by video link, G20 leaders will focus heavily on the two top-of-mind, interconnected crises: the deadly COVID-19 pandemic now surging in a second wave, and the economic recession it is deepening as countries' damaging lockdowns return. Leaders will spend some time on the closely related subjects of finance, development and digitalization, and will cover the compounding climate change and environmental crisis that Saudi Arabia highlighted at the start of its year as G20 host.

On health, G20 leaders will spur the swifter creation of safe, effective, trusted COVID-19 vaccines and produce principles and processes for their fast, equitable, distribution to — and affordable use by — all people over the next year or more, with health care and other front-line workers first in line. They will also address the many other diseases the virus has exacerbated, led by mental health problems compounded by anxiety and depression, rising non-communicable disease due to delayed treatment, growing antimicrobial resistance, and increased substance abuse and domestic violence.

On the economy,  G20 leaders will support more fiscal stimulus and supportive monetary policy in the United States, Europe and elsewhere. They will seek to have that policy better coordinated among G20 members and with their central banks, and will consider how long and how much the private sector and public will tolerate soaring deficits and debts, and how fast and how much inflation and rising interest rates might return.

On finance, G20 leaders will consider the risks of, and their response to, potential financial crises, erupting not only among their emerging economy members but even among their advance economy ones, among their governments, firms and households.

On development, G20 leaders will endorse their finance ministers' recent extension of the Debt Service Suspension Initiative for the poorest countries, agree to start debt write-offs, and grapple with the need for a permanent sovereign debt relief mechanism.

On digitalization, G20 leaders will promise to produce, by mid 2021, rules for the fair taxation of the exploding digital economy, and offer strategies to cope with the growing digital divides in jobs, education, gender equality and health that COVID-19 and its lockdowns have intensified.

On climate change, their greatest challenge, G20 Leaders will usefully affirm the concept of a circular carbon economy and promise to plant a trillion trees and protect the oceans. But they will struggle to repeat and fulfill their historic promise to phase out the fossil fuel subsidies that are helping heat the planet to unliveable levels now.

Propellers

This significant, short-term success is propelled by several forces.

The first is the unprecedented shock-activated vulnerability among all G20 members, now soaring to new heights in its strength, scope and severity. As 2020 began, the COVID-19 pandemic swiftly spread to become economic, social, ecological and human crises. Those have now brought a second shock, as a new wave of COVID cases, hospitalizations and deaths and the consequent economically and socially damaging lockdowns are soaring throughout most members of the G20 and across the world. The hope offered by the very recent progress in vaccine development will not be enough to stop the surging shocks and resulting damage to lives and livelihoods for many more months.

The second is the failure of other international institutions to respond adequately, at the summit level or below. A few weeks before the Riyadh Summit, the World Health Assembly, International Monetary Fund and World Bank Group met, but so only at the ministerial level. Moreover, the major United Nations summits on climate change and diversity, scheduled for 2020, were delayed until 2021.

The G7 was the first and fastest responder to the COVID-19 shock, holding an emergency summit in virtual form on March 16, 2020. But the regular 2020 U.S.-hosted G7 summit, scheduled for June, was repeatedly delayed. Three days before the G20 Riyadh Summit, there were no signs that it would ever take place.

The 2020 Russia-hosted BRICS summit, scheduled to be held in September in St. Petersburg, was also delayed. Its members' compliance with their leaders' priority commitments from their 2019 summit by then declined to an average of only 72%, well below the level it had recently risen to. The BRICS summit finally took place virtually only on November 17, four days before the Riyadh Summit's start. It did produce a long, collectively agreed "Moscow Declaration" with 97 paragraphs. But it contained only 45 commitments, as identified by the BRICS Research Group, a number below average since BRICS summits started in 2009. Moreover, these commitments focused heavily on old and new political security subjects, with only four on health and two on macroeconomic policy. Climate change had only one.

The third is the globally predominant and internally equalizing capabilities of G20 members in 2020. They together account for about 80% of the world's economy and greenhouse gas emissions and a strong majority of medical, digital and other key capabilities relevant to the G20's 2020 agenda. Internally, among G20 members, as the capabilities of the United States, other G7 and most BRICS members are declining, those of China are rising.

The fourth are the converging characteristics among G20 members on the key subjects that the Riyadh Summit will address. COVID-19 has catalyzed increasingly similar responses in lockdowns as well as the race to invent, acquire and deploy and effective, safe, affordable vaccine and the need for massive fiscal and monetary policy stimulus at a speed and scale never seen before. To be sure, political divisions among G20 members have grown, perhaps by a factor of two. But the shock-activated vulnerabilities that bring all members together in common cause have also grown, in strength, scope and severity — by much more, perhaps by a factor of ten, and certainly far more than the G20 has ever faced before.

The only exception could be China. President Xi Jinping, who could accurately say that he has already conquered COVID-19 at home and thus would be the only G20 member on track to end 2020 with positive economic growth for the year. But rather than taking the triumphalist, unilateralist approach that  this first-place status might produce, he is doing the opposite, putting international cooperation first. China is sharing its vaccines and economic strength with the rest of the world, starting with developing countries and the least developed among them. And President Xi has just joined the European and Canadian leaders as well as U.S. president-elect Joe Biden in promising to have his country become a new zero emissions one in the longer term. He is inching toward the G7's preferred approach on debt relief, and the transparency and fair burden sharing and effective new regime that requires. Moreover, Chinese and Indian troops are no longer killing each other in combat along their shared frontier.

Russia has become a peacemaker rather than a warmonger in Nagorno-Karabakh. Turkey has a new finance minister and central bank governor, offering hope that they might bring the country closer to the G20 consensus on how countries' macroeconomies work.

The fifth force is slowly, slightly strengthening domestic political cohesion within key G20 members. In the United States the November 3 elections showed parochial populism beaten, the internationalist Democratic Party gaining the presidency, holding the House of Representatives, and close to securing a majority in the Senate, when they are joined on specific issues by a few Republicans who share their views.

The great unknown is U.S. president Donald Trump. Traditionally, G20 and G7 summits have brought out the best in President Trump, when he was confident of winning everything, including a second presidential term. But that was changed in 2020 by COVID-19, the severe U.S. recession it caused, and by U.S. voters in their free and fair elections. Since then President Trump has been preoccupied with proving that he won a second term, leaving very little time for him to address anything else. It is unclear how much or even whether he will digitally connect from the White House to participate personally in the Riyadh Summit, or leave it to Vice-President Mike Pence, or Secretary of State Mike Pompeo who is scheduled to be in Riyadh, or Treasury Secretary Steve Mnuchin to represent the United States instead. If they do, it is also unclear if this will foster more American cooperation and collective summit success.

The sixth fourth is the G20's intensifying work as its leaders' cherished club at the hub of a global governance network.

Preparatory Process

The success of the Riyadh Summit will build on the preparatory process in several ways.

Prescient priorities came from the very start from the Saudi host. It set an appropriate, ambitious agenda that anticipated the crises the world faced in 2020 and beyond. The 22 priorities publicly presented on December 1, 2019, included health and economic growth. Above all, they highlighted climate change and the natural environment, which have now become central priorities for President-Elect Biden and President Xi.

Momentum soon came from the emergency summit that the Saudi presidency mounted in virtual form on March 26, 2020. This was the G20's first inter-sessional summit, first emergency one and first digital one. It produced 47 commitments, led by health, followed by the economy, development and trade. None of the commitments addressed digitalization or climate change. A mere two months later, G20 members had already complied with their priority commitments from the emergency summit at a level of 72%, slightly more than the all-time 71% average that members usually have a full year to reach.

Further momentum, down payments and interpersonal bonding came from the unprecedentedly intense and broad set of G20 ministerial meetings throughout the year. By the eve of the Riyadh Summit, the Saudis had mounted at least 26 meetings of 12 different ministers, alone or together, including the first for anti-corruption.

Finally, by October 10, G20 members' compliance with their priority commitments from their Osaka Summit on June 28-29, 2019, was already 78%, well above the all-time average.

This momentum shows that the G20 has survived the setbacks brought by the sudden shift to digital diplomacy in 2020. The virtual world makes much more difficult for spontaneous combustion on unscheduled subjects that comes from leaders' personal encounters at the summit tables, coffee breaks, in corridors or hotel gyms. It is also challenging for the all-night search to find the right words to let the G20 launch historic commitments in their collectively agreed declarations, such as the pledge to end fossil fuel subsidies made at the G20's Pittsburgh Summit in 2009. But it makes it much easier to schedule more meetings of leaders, ministers, officials and engagement groups, and to do so at short notice, when the time, expense and security concerns would prevent physical in-person ones from taking place.

Conclusion

In all, the Riyadh Summit leaders will do whatever is necessary to get the world through the following months, or longer should COVID-19 become controlled. But they could well need, and could certainly use, another emergency summit soon after January 2021 to cope with the many mounting challenges remaining and erupting then.

Riyadh's success will not be nearly enough to meet the soaring crises of COVID-19 and the existential one of climate change. The UN's 2021 summits for biodiversity next March and climate change in November will come much too late, and there are none for health or the economy in sight. Crises will not wait until the United Kingdom's G7 summit in late spring or early summer.

President Trump's reluctance to accept his loss in the U.S. presidential election and the resulting delay in the presidential transition process means another G20 summit will be needed, under the new Italian G20 presidency, soon after the inauguration of Joe Biden on January 20, 2021.

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