Consensus on the positive outlook for global economic growth
Finance ministers and central bank governors agreed that now is a good time to normalize monetary policy, and expressed optimism on the future of work, one of the priorities of the Argentine G20 presidency.
The Second G20 Meeting of Finance Ministers and Central Bank Governors concluded today with a press conference given by G20 finance chairs Argentine Treasury Minister Nicolás Dujovne and Central Bank President Federico Sturzenegger. At the end of the two-day meeting, the chairs drew attention to growth in the global economy and the opportunity to take measures to mitigate latent risks.
“The economic scenario in the world has strengthened and is very positive,” said Sturzenegger, pointing to global growth forecasts of 4% both for this year and for 2019.
Recognizing that risks still exist, such as a retreat to inward-looking policies and geopolitical challenges, the Central Bank President announced that that group agreed on now being the right time to normalize monetary policy at international level and “fix the roof while the sun is shining.” Dujovne reinforced this: “there is no room right now to avoid entering into countercyclical policies.”
Sturzenegger explained that monetary policy normalization should be a gradual process, one which requires better communication between members of the G20. In this respect, the chairs agreed that it was a very fruitful meeting, paving the way for progress on a number of issues.
One such issue mentioned by Dujovne was the future of work, one of the priorities of the Argentine G20 presidency. “We have a very positive view on the outcome that [technological change] will have in terms of growth in the medium and longer-term. But, of course, this is also a challenge for our citizens who are facing this dramatic change in the way in which we produce, consume, communicate,” he explained.
Dujovne indicated that the G20 is working on concrete public policy proposals that will be presented at the next finance ministerial meeting in Buenos Aires in July, mentioning that taxes and competitive conditions can be used to “help with this transition.”
The Compact with Africa (CWA), an initiative launched under the German presidency in 2017 to promote private investment in Africa, was also addressed by the finance leaders. The considerable progress made in this area “shows how important the G20’s institutional work is,” stated Dujovne, adding that of the 100 CWA projects launched, 25 have been completed.
When questioned on contentious issues surrounding trade this year, in particular between China and the United States, Dujovne and Sturzenegger alluded to the group's agreement on the importance of global trade. “There was a general appeal for multilateralism,” said Sturzenegger. “Even when there are some differences… we have a very strong consensus on how beneficial trade is in terms of increasing growth, increasing prosperity, lifting productivity,” added Dujovne.
About the G20
The G20 started out in 1999 as a meeting of finance ministers and central bank governors. In 2008, amidst the global financial crisis, it evolved into what it is today: a major forum for dialogue and decision-making attended by world leaders from vital economies. Together, the G20 members represent 85% of global GDP, two-thirds of the world’s population, and 75% of international trade.