Finance chiefs from the world’s most powerful economies start two days of official meetings in Bengaluru amid sharpened geopolitical tensions and growing doubts that consensus can be reached on critical global issues such as debt relief for poorer nations.
(Bloomberg) — Finance chiefs from the world’s most powerful economies start two days of official meetings in Bengaluru amid sharpened geopolitical tensions and growing doubts that consensus can be reached on critical global issues such as debt relief for poorer nations.
Indian Prime Minister Narendra Modi made a last-minute address to the gathering Friday morning, recognizing “serious economic difficulties” and “rising geopolitical tensions” that cloud the talks, without calling out Russia’s war in Ukraine by name.
US Treasury Secretary Janet Yellen said Russia ending the war was “the most important thing” for the global economy as she accused officials from Moscow attending the Group of 20 meeting of being complicit in atrocities taking place in Ukraine.
The gathering coincides with the one-year anniversary of Russia’s war in Ukraine. The war divides attendees at the meetings between a US-led coalition that’s calling for a boost to Ukraine aid and to ratchet up the pressure on Vladimir Putin’s regime, and those who would prefer not to talk about it.
The division was on display Thursday as G-7 host Japan held a meeting of that group’s delegations and presented a statement with renewed condemnation of Russia and set aside more aid for Ukraine.
By contrast, Indian officials are pushing to keep “war” out of any final statement from the meetings, and remain confident that they can deliver a traditional communiqué at the end of meetings rather than a watered-down chair’s statement.
Aside from Russia’s war, US-China tensions remain heated in the aftermath of the spy balloon episode. And those divisions are spilling over into the topmost agenda items, including how to restructure debt for many low-income countries in distress.
“Trust in international financial institutions has eroded,” Modi said. “This is partly because they have been slow to reform themselves. It is now up to you — the custodians of the leading economies and monetary systems of the world to bring back stability, confidence and growth to the global economy.”
Broader questions loom around how those multilateral lenders — especially the World Bank — should be reformed, with Yellen calling for more leverage of private sector finance and more focus on big global issues rather than individual projects.
The US announced its nomination of former Mastercard Inc. Chief Executive Officer Ajay Banga to succeed the departing David Malpass as World Bank president — a post traditionally held by an American with the US as the largest shareholder.
Friday’s meetings in Bengaluru, formerly known as Bangalore, start with a marathon three hours’ worth of discussions on the global financial architecture, sustainable finance, and infrastructure.
–With assistance from Haslinda Amin, Anup Roy, Devidutta Tripathy and Vrishti Beniwal.
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