G20 Sherpas' Meeting was held in Moscow
On March 3-4, 2013 the Second G20 Sherpas' Meeting was held in Moscow within the framework of Russia's G20 presidency.
The G20 Sherpas discussed the results of the G20 Finance Ministers and Central Bank Governors Meeting held in February, and the implementation of the Framework Agreement for Strong, Sustainable and Balanced Growth, as well as the issues of investment financing, reforms of the international financial architecture, financial regulation and the impact of structural reforms on economic growth.
Besides, the main outcomes of the G20 working groups' meetings, namely, on energy sustainability, employment, anti-corruption, and development, which were held earlier in February, were reported to Sherpas.
The delegates were also addressed by the representatives of the Business 20, Civil 20 and Youth 20, who delivered on the activities of their respective outreach groups in 2013.
The G20 Sherpas also discussed the preparatory process for the St.Petersburg summit.
The Second G20 Sherpas' Meeting was held in a constructive manner, Ksenia Yudaeva said, reminding that the G20 Sherpas' main task is to prepare for the G20 Leaders Summit. It is to be determined which problems of the global economy will retain their topicality until September and hence should be placed into the Leaders' agenda. "The G20 Sherpas have agreed that the issues raised by Russia for the G20 within its Presidency's framework - jobs and employment, investment and economic growth - have priority importance, thereby, these issues rather than attempts to address shorter term tasks must be the focus of the G20," told Ksenia Yudaeva, Chief of the Presidential Experts Directorate and the Russian G20 Sherpa, in her interview to the "Rossiya 24" TV channel.
According to the Russian Sherpa, the Russian proposal that the G20 countries should undertake a commitment to stabilize their foreign debts and budget deficits was put under scrutiny at the meeting. The corresponding commitments made at the Toronto Summit in 2010, have not been fulfilled, that is why nowadays the G20 countries have to adopt a more thorough and substantiated approach towards the issue. "There are objective difficulties that are preventing member countries from undertaking equally tough commitments," Ksenia Yudaeva continued. "We are no longer insisting that all the G20 countries should simply halve their deficits, as was decided in 2010. We have proposed a more flexible system, allowing for the G20 countries' assuming of medium-term obligations that will differ from country to country and will take into account their institutional limitations."
During their second meeting in Moscow, the G20 Sherpas gave full recognition to Russia's idea that investment should be the key tool for job creation. They agreed that a working group should be established within the Finance Track to collect all the relevant proposals. "It is quite clear even now in which areas proposals will be made," the Russian Sherpa noted. "We are also considering the possibility of modifying mandates of national and international development banks, with the goal of focusing the institutions for development on promoting investment, primarily in infrastructure, and supporting public-private partnerships in this area."
Sherpas also touched upon the issue of long term finance; in this regard the role of regulation was addressed. "In view of changes in regulation over the past 10 years, the duration of investments by long term finance institutions (notably, pension funds, insurance companies, etc.) has become shorter. Therefore, we need to review our approaches to regulation and possibly draft relevant recommendations," Ksenia Yudaeva said.
The urgent need to develop local and regional capital markets, which should generate funds for investment and increase the stability of financial markets, primarily in the emerging economies, also received much attention at the Sherpas' Meeting.
With reference to the issues of the employment agenda, the G20 Sherpas pointed out the importance of an integrated approach, but at the same time of respecting individual circumstances of a particular country, both in terms of country-specific problems and their possible solutions. "Unemployment is a major problem in a number of the developed countries, including structural and primarily youth unemployment," Ms. Yudaeva said. "But in other developed countries this is not an acute problem. According to the OECD data, youth unemployment in Germany is lower than overall unemployment. Structures of the emerging market economies are rapidly changing, and since the young people are a more flexible group of the population, they can adjust by taking up jobs in the new sectors. There are countries with almost full employment, where unemployment is at its historic lows, but the economic growth rate has also slowed there. So their goal is not to create just any jobs but quality jobs."
The need for a flexible approach on this issue was stressed in numerous Sherpas' interventions. One of the goals is to accumulate best policy response practices, but on the other hand, it should be up to the countries to freely choose the practices that suit them best.
During their second meeting, the G20 Sherpas also discussed the Russian initiative on attracting investment into the energy sector. "Promoting this initiative includes holding meetings of regulators and analysis of international experience," Ksenia Yudaeva informed. "Recommendations resulting from this work should help us regulate the energy sector in order to make it attractive for investors. This is one of the key issues of domestic policy for Russia."
Ms. Yudaeva pointed out that the anti-corruption issues were also vigorously discussed. The main task in this area is to implement the G20 Anti-Corruption Action Plan for 2013-2014, which is the basic document that sets out the main elements of the anti-corruption agenda. Additionally, Russia has put forward several new initiatives, including fighting corruption while organizing and holding major international sports events and in the sphere of privatization.
The Russian Sherpa emphasized that the representatives of the Civil 20 and Business 20 contributed to the efforts of the G20 Anti-Corruption Working Group, which is an important innovation introduced by Russia's Presidency. The participants recognized the efficiency of this approach.
Commenting on Russia's stance on the outreach dialogue, Ksenia Yudaeva said that in previous years considerable attention to the outreach was given just at the final stages of the respective Presidencies. "Business and Civil Summits were held immediately before the G20 summits," Ms. Yudaeva noted. "Recommendations were being formulated, but they were not complemented with institutionalized methods for incorporating these recommendations into the official track. Russia will work closely with business, civil society, youth and labour organizations throughout the year of its presidency, seeking to incorporate these communities' recommendations into the official process. From our viewpoint, this approach will help us enhance the effectiveness of the entire process."