HAMBURG — In July 2017, the member countries of the G20 met for their 2017 Summit in Hamburg, Germany. The Group of Twenty (G20) is an international forum that brings together the leaders of the world’s leading and emerging economies. The goal is to discuss cooperation in facing global and regional economic issues.

While heads of state traditionally focus on international financial markets, other significant issues have been discussed as well due to the fact that they correlate with global economics. Poverty is one of these topics of interest, and the G20’s plan to fight global poverty was discussed in depth in Germany.

The G20 members account for a majority of global population and GDP. Because of this, according to Federal Foreign Minister Sigmar Gabriel, “The G20 bears a social responsibility…[and]must address the root causes of conflicts, as well as options for peaceful crisis prevention and conflict settlement.”

The eradication of global poverty is a complex issue because of the collateral impacts its alleviation has on every major industry in developing nations. Gabriel reiterates that combating poverty, therefore, is a priority for G20 program participants.

In terms of poverty alleviation, however, the G20’s record has been far from perfect. At the organization’s inception, the G20’s plan to fight global poverty even seemed to be motivated by potential financial prospects.

At the 2009 summit in London, for example, heads of state announced that they would collectively put up $1.1 trillion in support of all countries, $50 billion of which was specified for developing nations. While this made headlines around the globe, the majority of this money is in the form of loans, which meant that developing nations would need to pay that money back with interest. As stated in a 2009 piece by Neil Watkins, “This is sort of like if a car ran into your house and the driver of the car offered you a loan to pay for the damage.”

Additionally, while the $50 billion offering seems sufficient, it actually isn’t. According to a 2009 op-ed by Brookings, “Many emerging markets now face threatening…problems, especially those with large current account deficits…for 2009 and 2010, a minimum of $500 billion will be needed.”

So, what is the G20’s plan to fight global poverty eight years later? The answer has to do with the United Nations 2030 Sustainable Development Goals.

According to the G20 2016 Action Plan, world leaders agreed that the best way to eradicate poverty is to align its work with the United Nations Agenda for Sustainable Development. These measures include, but are not limited to, mobilizing resources related to public health, advocating against corruption and financing actions aimed at fighting climate change.

The underlying theme behind this plan is to utilize a mix of policy consultation and foreign direct investment to not only eradicate poverty but to create a vehicle for sustained economic growth in these areas.

The point here is that the G20’s plan to fight global poverty looks to be evolving. While the group’s main instrument for offering assistance is still financial, it is specifically moving away from passive loans contingent upon interest to active investment in the resources, assets, and people all throughout the developing world.

Will this shift in strategy bring tangible improvements to the G20’s efforts in developing low-income countries? Only time will tell. In the meantime, it will be extremely important to track these efforts in the years to come.

– John Mirandette

Photo: Flickr