G20, leadership and crisis response diplomacy

Yayan GH Mulyana, Jakarta | Fri, 11/11/2011 8:41 AM A | A | A |-Klipping the Jakarta Post

“L’Histoire s’écrit à Cannes” (History is being written at Cannes). The sentence was firmly written on the billboards that stood along the main roads of the scenic city of Cannes. A sign of France’s determination to make the G20 Summit, under its presidency, a historic event.

The Cannes G20 Summit was indeed historic as it was to address one of the greatest challenges facing humankind right now: the financial instability in Europe, which may eventually affect the whole world.

The G20 leaders were to respond in unison to the eurozone crisis as the core of financial instability and, in fact, the eurozone issue dominated the entire sessions of the first day of the Summit. For Europe, the eurozone crisis had signaled an almost “Cuban missile crisis” sense of urgency.

The Cannes Summit also marked the increasing significance of economic diplomacy, from working levels to the summitry level. Diplomacy is always essential in time of peace, let alone in times of crisis like the one in the eurozone.

More importantly, it has given impetus to the emergence of crisis response diplomacy.

The first critical element to the success of crisis response diplomacy is leadership: collective leadership and the leadership of the presidency. The collective leadership is built upon common interests, shared responsibility, joint efforts and synergized commitments and their implementation by the members of a cooperation forum.

The leadership of the presidency is critical not only in exercising chairmanship and providing a platform for negotiations and deliberation but also in navigating the forum or organization through the various challenges.

Its role is critical in giving emphasis to issues of priority. France, for example, included IMS reform, development, corruption, commodity price volatility, financial regulation and the social dimensions of globalization as its priorities. One challenge to the French presidency has been how to ensure that the G20 process is not Eurocentric at this juncture.

Leading by example, by members as well as the presidency, is an important pillar of crisis response diplomacy. In times of crisis, showing examples not only gives a moral boost but also expands the chances for tangible results.

The second critical element is the ability to solve problems. Crisis response diplomacy is more than “jaw-jaw”. It promotes solutions and makes them deliverable. The capacity of the G20 in getting results is notable.

The forum was able to help mitigate the repercussions caused by the 2008 financial crisis. It is now able to charge collective action to tackle the challenges of weakened growth and increased unemployment. The Action Plan for Growth and Jobs is one of the important documents of the Cannes G20 Summit that charts synergized action by the G20 members to promote growth and create jobs.

Crisis response diplomacy may also have a preventive dimension. Leaders and negotiators could come up with a generic or fully fledged idea for an early warning system and prevention. The G20 has been advancing measures to prevent risks that could undermine financial stability and promoting sustainable growth at the national and global levels.

The fourth element of crisis response diplomacy is strategizing. This is pursued through such measures as rebalancing, recommitting, rebounding and restructuring. As reflected in the Final Declaration and the Communiqué of the Cannes G20 Summit, the G20 economies recognize the persisting presence of global imbalances and reaffirm the commitment to address those imbalances.

Crisis is often contagious. It has a domino effect. Thus, managing contagion is another critical part of crisis response diplomacy. Managing contagion and narrowing it down, or even eliminating it requires bold decisions and sustained efforts. As reflected in its communiqué, the G20 member countries express support for the decisions by European Leaders in building firewalls to circumvent contagion.

Crisis response diplomacy cannot be bogged down by one or two issues. Leaders and negotiators cannot loose sight of other urgent problems. That is why, during the summit, President Susilo Bambang Yudhoyono touched on development, food and energy security and job creation. These are issues that matter most to Indonesia and other emerging and developing countries.

For G20 to have long-term relevance and bring about favorably tangible impacts, the forum will have to go beyond crisis response diplomacy. It will have to develop catalytic diplomacy, in particular with a view to creating global governance that founds a stable, strong, sustainable and balanced architecture for global growth and development.

Sustainability of leadership is essential to achieving that objective. Thus the introduction by the G20 at Cannes of arrangements for a presidency as part of the G20 reforms are pertinent. After 2015, annual presidencies will be decided based on regional group rotation, starting with the Asian Group (China, Indonesia, Japan, and Korea).

One final point, despite its status as the premier forum for international economic cooperation, can G20 do it alone?

G20 is indeed a premier forum, but it is not the only forum. It is pertinent to reflect on how the G20 is related to other forums of cooperation such as APEC, ASEAN, NEPAD, SELA, the UN, and many others, as well as with other key players such as the IMF, the World Bank, and the private sector.

From the geographic configuration, G20 comprises six member countries from Asia, one from Africa, eight from Europe, and five from the Americas. This picture warrants collaborative work that reflects common concerns and shared responsibility.

The writer is an assistant to Special Staff to the President for international relations. The opinions expressed are his own.