The rise of the G20
The hitherto obscure ‘Group of 20 Finance Ministers and Central Bank Governors’ suddenly emerged as a key actor in IPE amidst the backdrop of the ‘Credit Crunch’ global recession in2008–9. This G20 was not the same as the G20 WTO caucus group of the most powerful developing states, referred to earlier. It includes the following 19 states: US, Japan, UK, Germany, France, Canada, Italy, Spain, Russia, Australia, China, Brazil, India, South Africa, Mexico, Argentina, South Korea, Turkey, Indonesia and its 20th member is the EU. G20 was set up by G7 in 1999 in response to the Asian financial crisis in order to coordinate monetary planning with key economies affected by the downturn (which spread to Latin America). Once the global economy began slumping in 2008, however, low key annual meetings of finance minsters and the heads of the Central Banks became high profile twice yearly summits inclusive of heads of government.
G20 is not an intergovernmental organisation – the meetings are chaired and hosted by its members in a rotational ‘Presidency’ – and it has no formal criteria for membership. However, the fact that it contains members accountable for 85% of global GDP and 80% of global trade and the need for a more universal means of coordinating policy has thrust the group into the spotlight. G20 has emerged from relative obscurity to become an overall political steering mechanism for the global economic system. That this grouping, rather than just the G7, had come to be seen as necessary to consider measures to get the world out of recession and debate the future of the Bretton Woods system was indicative of a significant shift in the balance of world economic power.