G7 panel calls for change in global economic governance ahead of G20 and Cop26
The G7 Economic Resilience Panel called for a significant change in economic governance to better prepare global economies for the next crisis.
Under Britain’s G7 presidency, Prime Minister Boris Johnson appointed Lord Sedwill, former cabinet secretary and national security adviser, to chair an independent G7 panel on economic resilience.
The panel, made up of eight experts appointed by G7 leaders, was invited to report on the challenges of the global economic system and assess policies aimed at building resilience to future shocks.
Lord Sedwill presented the group’s initial set of recommendations to the G7 at a summit in Cornwall in June and this latest report aims to inform discussions at the upcoming G20 Leaders’ Summit and the Cop26 climate talks in Glasgow.
The main recommendations of the panel are as follows:
– Stimulate international and national investments in economic resilience to provide the new infrastructure and research needed to meet the challenges of the coming decade.
– Ensure that international trade rules enable the green transition, demonstrating the leadership of the G7 and its allies through smaller agreements and alliances within the members of the World Trade Organization
– Commit to information sharing, traceability and the reform of environmental, social and governance standards for minerals essential to the green transition.
Lord Sedwill said: “Globalization has seen the greatest increase in prosperity and reduction in poverty in human history. But the Fourth Industrial Revolution, the rise of China, and environmental, economic and geopolitical events have overtaken global economic governance.
“Economic resilience is ensured through diversification, co-dependency and public-private partnerships within well-governed, open and integrated global markets.
“The ‘Cornwall Consensus’ reflects this vision and recommends investments, standards and inclusive governance to meet the challenges and opportunities of the mid-21st century. “
The report says climate change, loss of biodiversity and the next health crisis are about to destabilize national and global economies.
He adds: “Preparing for the next crisis requires a fundamentally different approach to economic policy and international collaboration. The 2020s are a crucial decade for building economic resilience.
“With the first face-to-face meetings of G7 and G20 leaders since the start of the pandemic, we have the opportunity to learn multiple lessons from each other’s responses to associated shocks.”
Panel member Thomas Wieser, former chairman of the Euro Task Force and the European Financial Committee, said: “The European Union has weathered the pandemic relatively well, but it has been a wake-up call: Internal and external disruptions to established lifestyles, trade, movement and production have shown the fragility of national and global systems.
“The recommendations of our G7 panel on economic resilience provide a clear roadmap towards a new socially and environmentally responsible way of global cooperation and governance of open societies. “
Another panel member, Professor Thomas Philippon, economic adviser to French President Emmanuel Macron added: health – require a set of new principles to guide policy makers and foster the common good.
“The ‘Cornwall Consensus’ is our contribution to this continuing effort.