The week in review: Summits, pledges and reality
Leaders of the G20 have pledged to take action to boost weakening world economic growth and support moves by eurozone countries to move toward a banking union to restore stability to the financial system, but they offered little new concrete aid.
The communiqué issued earlier this week after two days of talks in the Mexican resort of Los Cabos appeared to herald a shift in favor of the need to stimulate growth and will now put the focus on the summit of EU leaders later next week.
The G20 leaders appeared to recognize the risk that eurozone fears could spark turmoil across financial markets in the coming months, pledging to inject an extra US$456 billion into the International Monetary Fund to act as a firewall against further financial contagion.
They voiced support for the eurozone to take steps toward greater financial integration of the 17-member single-currency bloc, such as banking supervision, bank resolution and recapitalization, and deposit insurance.
The leaders vowed not to erect new trade barriers until 2014 to foster global growth.
However, the International Chamber of Commerce (ICC) strongly criticized the G20 leaders, pointing out that while the world economy was experiencing the worst crisis of the last 60 years, multilateral talks had stalled and protectionist measures had proliferated.
ICC Secretary General Jean-Guy Carrier quoted a research report of the Global Trade Alert during the G20 Business Summit in Los Cabos on Monday showing that the world’s richest developed and emerging economies had added about 225 protectionist measures over the past two years alone.
The rise in protectionist measures was also amply documented in recent detailed reports, prepared jointly by the World Trade Organization (WTO), the Organization for Economic Cooperation and Development (OECD) and the United Nations Conference on Trade and Development (UNCTAD) at the request of the G20.
Anyway, most analysts have from the outset not put too much importance on the G20. After its widely recognized success as a fire fighter at the time of the financial crisis about three years ago, many observers have criticized the G20 forum mostly as a talking shop to let policymakers understand what their counterparts elsewhere are up to and why.
But then while there is a gap in global economic governance at leadership level, the G20 is still seen as best-placed to fill that space, one structure that people look to for guidance.
No wonder, many did not expect much from the gathering this week of global leaders, development experts, bankers, academics and activists in Rio de Janeiro held immediately after the G20 summit to celebrate the anniversary of the landmark Earth Summit of 1992.
The conference tried to address the linked problems of poverty, hunger, energy shortages and environmental degradation but the big gathering seemed to be overshadowed by economic and political crises around the world.
There are few expectations for concrete action or pledges of new aid to developing countries. The absence of key leaders from developed countries dashed the hopes for more concrete results.
Delegates said the constraints of the still-faltering global economy had dampened hopes and refueled the conflict between industrialized and developing countries that had hobbled international development and environment talks for years.
But Indonesia’s President Susilo Bambang Yudhoyono, one of the leaders attending the meeting, seemed not to be discouraged by the skeptics. He was instead still optimistic that the Rio summit would come out with a lot of firm action programs.
Yudhoyono briefed delegates from more than 190 countries on Indonesia’s programs to stop deforestation through a two-year moratorium on new permits for logging and exploitation of peat land in cooperation with the Norwegian government that pledged $1 billion in funding.
“We also launched a nationwide campaign to plant trees, which in the last two years have resulted in 3.2 billion trees being planted. We did this out of our own volition, but we also expect the world to support our efforts beyond rhetoric and finger pointing,” he said.
However, most environmental NGOs in Indonesia criticized Indonesia’s poor progress in reforming its forestry sector as deforestation has continued, thereby jeopardizing its campaign to reduce carbon emissions by 26 percent by 2020.
Even Norway’s Environment Minister Bard Vegar Solhjell was quoted by Reuters as observing that the moratorium itself would not be sufficient to achieve Indonesia’s climate change mitigation.
The $1 billion Norway has promised under the deal is contingent on policy change and proven emissions reductions from the forestry sector.
The conference, formally titled the Conference on Sustainable Development, but more popularly known as Rio+20, tried tackling big questions such as protecting the world’s forests and fisheries, weaning the world off fossil fuels and encouraging farming and economic growth that does not destroy the natural environment.
As Indonesia participated in the two important summits abroad, the nation witnessed an Indonesian Air Force Fokker F-27 aircraft crashing into the ground at the Rajawali military housing complex, near the Halim Perdanakusuma Airbase in East Jakarta on Thursday afternoon. All seven crew members and three civilians on the ground died.
Also on Thursday, the West Jakarta District Court handed down a 20-year prison sentence to Umar Patek for illegal possession of firearms and explosive devices and chemicals, premeditated murder in the 2002 Bali bombing and the 2000 Christmas Eve church bombings in Jakarta.
— Vincent Lingga
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