May 23, 2013
Higher School of Economics, Moscow, Russia

On May 23, 2013, CGI and the Council on Foreign and Defense Policy (SVOP) presented CGI’s new report, “Toward the St. Petersburg G20 Summit: Russia’s Turn to Steer the Group of Twenty,” at the Higher School of Economics in Moscow. In attendance were finance experts, representatives from multinational organizations, delegates from the Russian government, young professionals, and journalists.

CGI President Nikolai Zlobin and Fyodor Lukyanov, chairman of SVOP and editor-in-chief of the journal Russia in Global Affairs moderated the event, while Daniel Lucich, report co-author and senior adviser at Guggenheim International, presented his findings in conjunction with an expert panel. The panel included Sergei Dubinin, chairman of the Supervisory Council of VTB-Bank, and Sergei Aleksashenko, director of macroeconomic research at the Higher School of Economics. The speakers noted that while half of Russia’s Presidency has already passed, the St. Petersburg summit still lies ahead, and therefore the issue of Russia’s strategy in the G20 remains of critical importance.

Nikolai Zlobin said that CGI’s report on the summit is useful in effectively representing the position of the U.S. and a significant part of the Western global elite regarding the Russian Presidency of the G20, and Russian leadership in international organizations in general. The report’s goal is to help the Russian team prepare for the G20 summit and to understand what others think about and expect of Russia.

Daniel Lucich noted that other multilateral institutions, such as the G8, have lost relevance over time because they do not represent the interests of the world’s population. In contrast, the G20 covers more than 80 percent of global GDP and two-thirds of the world’s population. As such, the G20 has a much bigger claim to becoming a global forum. Whether the G20 can be effective, however, is a separate question. The larger the organization, the more difficult it is to manage—this is the central challenge of the G20.

Lucich also observed that expectations of the G20 as an organization are low, a phenomenon that includes expectations for Russia’s Presidency. These modest expectations stem in part from Russia’s lack of a clear reputation or record as a leader in large multinational organizations. The three issues that could become the main priorities of this summit are food security, climate change, and the question of trade. Each of these topics has been raised by G20 members in earlier sessions, but they remained on the periphery of discussions. This presents an important opportunity for Russia: even small progress on these issues will be viewed as an unexpected success.

Sergei Dubinin remarked on the fact that organizations like the G20 are an interesting phenomenon, since by definition they include countries that should be in opposition to each other—specifically, the BRICS nations and the developed nations. He also noted that relationships are formed between nations, not between groups of nations, and this trend will continue for the next decade. This development could lead to divergence because of the different economic dynamics of the member states; on the other hand, the tendency to establish uniform standards, primarily financial standards, could continue. The activities of the Basel Committee on Banking Supervision and the creation of common global bank development standards are an example of the latter. Russia holds an ambiguous position in the group: it may work to deepen the split and unite a smaller group of states led by the BRICS nations, or it could attempt to participate in the consolidation of countries and the development of common standards.

Russia’s G20 presidency provides a chance to act on bolstering investment and economic growth, but a distinct plan to stimulate economic growth is lacking from the Russian team and from the world more broadly. As such, it will be important for Russia not to create a break in the group, but to maintain an atmosphere of cooperation. This in itself will be an achievement.

Sergei Aleksashenko called attention to the fact that the organization played a crucial role in the recent financial crisis. When the world economy reached its nadir, G20 member states came together and adopted a set of solutions. But as the global financial crisis showed signs of improvement, cooperation between these countries seemed to decrease. Perhaps these member states realized they have little in common and are too different from each other. But the world is changing and becoming even more globalized. For business, there are no national borders and national regulations, and in these circumstances the task of the G20 is to strengthen existing institutions, such as the IMF, the WTO, and the World Bank. The G20 could become a majority shareholder in the management of these organizations.

Click here to watch the launch event

Read CGI’s report here:

Toward the St. Petersburg G20 Summit: Russia’s Turn to Steer the Group of Twenty

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