With the many financial calamities happening throughout the world of late, it would seem that the scheduling of a major event to discuss key issues in the global economy would be announced with great fanfare.
The G20 meeting of finance ministers and central bank governors that took place over the weekend seemed to have sneaked in almost surreptitiously. I was hard pressed to find many announcements of the September 3-4th meeting in Istanbul despite the fact that the date was reserved several months ago. Could it be that this was an indication of the failing influence of this group in bringing about any consistent and durable effect on global markets?
The G20 is viewed as the most important forum of global governance and cooperation, largely replacing the once powerful G7
G7, G8, G20
What exactly is the G20 and what is its role in the global financial scene?
The Group of Twenty (G20) Finance Ministers and Central Bank Governors met for the first time in December 1999 in Berlin in order to coordinate efforts in helping industrialized and developing economies and to discuss key issues in the global economy. It was hosted by German and Canadian finance ministers.
The original concept of international financial figures meeting collectively goes back much further than 1999, however. It was introduced in 1971 with the collapse of the Bretton Woods system of fixed international exchange rates which up until then had been tied to the price of gold. With the 1973 oil crisis, the need for better coordination of economic and financial policy at the executive level became even more evident and on March 25th, 1977, finance ministers from Britain, France, Germany and the United States met and formed the “Library Group,” named after the venue of their initial meeting — the White House Library. This group became known as the Group of Five or G5. Japan joined the group in September of that year, and Italy was invited to the first meeting held in France in 1974.
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