G-20.jpgWhen the G-20 met in London in April 2009, they produced a Communiqué containing just 688 words. And as the blog noted in conclusion, there was “no sign of a ‘Plan B’ being developed“, in case the Stimulus measures failed to work.
This was still the case last September in Pittsburgh, when the Leader’s Statement had grown to 9292 words. Now, after this weekend’s Toronto summit, the Declaration’s word-count has risen still further, to 10713 words and 27 pages.
This highlights a sense of drift and ineffectiveness within the G-20. The key output required in a report are answers to the questions ‘Why?, What?, When? and How?’ But these questions, let alone their answers, are sadly lacking. There is no clear action plan to address the key issue of how the G-20 will help to return the global economy to a growth path.
And yet, by its 4th point, the leaders recognise that “serious challenges remain“. And they add that “while growth is returning, the recovery is uneven and fragile, unemployment in many countries remains at unacceptable levels, and the social impact of the crisis is still widely felt.”
This is quite a shift in mood from the “It worked” comment in Pittsburgh. And it is accompanied by an acceptance that “those countries with serious fiscal challenges need to accelerate the pace of consolidation“. This group, of course, includes much of the European Union, which accounts for 28% of global GDP – a larger share than the USA.
If nearly a third of the world economy is now in “consolidation” mood, then it is wishful thinking to imagine that the other 2/3rds can effectively compensate. Plus, of course, once we are past the mid-term elections, no doubt the USA will formally join the consolidators camp.
Deflation and protectionism are becoming bigger and bigger risks for the chemical industry as the Crisis continues.