Recognizing that the G20 agenda bears directly upon business goals for trade, economic growth and job creation, ICC has undertaken the responsibility to share global business views on these topics. Our aim is that you find these views to be of value to your deliberations.
Our focus, like yours, is currently on Cannes and to this end we are collaborating with other key groups, including the World Economic Forum (WEF) and the Mouvement des entreprises de France (MEDEF). Over the longer run, we endeavor to establish an enduring, legitimate voice of global business and a primary source of business expertise on the global policy agenda.
The following recommendations are the product of an inclusive, global consultative process that has collected input from companies and business organizations of all sizes and in all regions of the world.
1. Trade, investment and development
The G20 has a key role to play in ensuring an open global economy that will facilitate cross-border trade and investment by business to nurture economic recovery, job creation and sustainable development.
2. Strengthening financial regulation and ensuring the availability of trade finance
New global financial regulations should be complemented by effective international supervisory mechanisms and consistent implementation across jurisdictions. Great care should be taken to avoid that new regulations have a detrimental effect on the availability of trade finance, especially in developing countries.
3. Fighting corruption
Corruption threatens the integrity of markets, undermines fair competition, distorts resource allocation, destroys public trust and undermines the rule of law. It is estimated that corruption adds up to 10% to the total cost of doing business globally, and up to 25% to the cost of procurement contracts in developing countries. Moving business from a country with a low level of corruption to a country with medium or high levels of corruption is found to be equivalent to a 20% tax on foreign business.
4. Reforming the international monetary system
While the global economy may have avoided the worst of the crisis via the injection of massive amounts of fiscal and monetary stimulus, several broad issues regarding the current international monetary system remain, including the set of rules, norms, and institutions that governs the world’s currencies and the flow of capital across borders. Dealing with these issues requires both fiscal and structural reform as one without the other is not sustainable in the long term.
5. Mitigating the adverse impacts of commodity price volatility
Commodity markets are inherently volatile, as evidenced by the 2007-2008 rise and fall of prices as well as by recent fluctuations due to global political tensions. Rising commodity prices, particularly for fuel and food, have placed millions at risk of malnutrition and hunger and are exacerbating social and economic tensions worldwide. During the recent period of global economic expansion – 2002 to 2008 – the factors that drove prices were a combination of strong global demand in emerging markets for global commodities, slow supply responses, and low inventories, thus reducing the ability of markets to react to events.
6. Encouraging Green Growth
The prospect of critical, interlocking crises for climate, energy, food and water presents the G20 with a significant challenge to secure and expand economic opportunities for a growing population while ensuring that economic growth and environmental and social responsibility work together in a mutually reinforcing fashion.
This recommendation paper is also available in:
Chinese: 供20 国集团官员斟酌的政策建议鉴