G20 summit predictions: The easy and not-so-easy wins

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Progress is hard won at any G7 or G20 – a harsh reality reflecting the need for consensus among so many countries, some of whom do not like each other.

The G20 in Rome, which formally began Saturday morning, a day before the start of the COP26 climate summit in Glasgow, will be no different. Still, the immediate and pressing global environment and health needs raise the odds that at a least a small number of breakthroughs will be made by the time the final communiqué is published Sunday evening.

Herewith, my list of possible wins, ranking by likelihood of success. I am not counting the near certainty that the G20 leaders will endorse the global minimum tax. Most of the work on that file, by the G20 finance ministers and OECD, was done well ahead of the Rome summit.

What is the G20 summit and why are world leaders meeting in Italy?

CLIMATE FINANCE: Twelve years ago, at the climate summit in Copenhagen, the wealthiest countries promised to raise US$100-billion a year in funds that would be channelled to developing countries to help them adapt to climate change and reduce their carbon intensity. The amount was to come from bilateral, development bank and private financing, and export credits. The promise was broken. The US$100-billion figure has never been reached, though the OECD suggests that the shortfall was only a bit more than US$20-billion in 2019, the last year for which there is adequate data. Pledging to bridge the gap in Rome should not be a bridge too far. U.S. President Joe Biden came to the G20 with plans for a scaled back, though still enormous, social spending and climate plan worth US$1.75-trillion. Surely a few billion dollars of that amount could drop into the climate finance budget. And what better way to earn goodwill among the developing countries than to land in Glasgow with the news that the US$100-billion climate finance target had finally been reached?

Odds of success: Very high

VACCINES: A year after the rollout of COVID-19 vaccines, only about 3 per cent of the population of low-income countries has been vaccinated. If the G20 does not address this appalling shortfall, it would be condemned as a callous rich countries’ club. On Saturday morning, the G20 site was abuzz with rumours that leaders would endorse a plan to jab 70 per cent of the global population by mid-2022, in line with World Health Organization’s plea. The goal would be achieved by delivering spare doses to Covax (the global vaccines alliance), buying more doses for Covax, and reallocating portions of the G20 countries’ special drawing rights (SDRs) to the areas of the world that need vaccines most. SDRs are issued by the International Monetary Fund and are a reserve asset that can be traded among countries for liquidity or cash. There is a fair chance that the G20 countries will in effect donate as much as US$100-billion of their SDRs to poor countries to help them beat the pandemic.

Odds of success: Very high

FOSSIL FUEL SUBSIDIES: You would think that, by now, the rich countries – those that historically have accounted for the bulk of the planet-warming carbon emissions – would stop using oil, gas and coal subsidies to encourage even more emissions. Forget it; those subsidies are still intact and rising in some cases. Bloomberg reported that the G20 countries have provided more than US$3.3-trillion in support for fossil fuel production since the 2015 Paris climate agreement (the G20 had agreed way back in 2009 to phase out “inefficient” fossil fuel subsidies). Among the worst offenders are Australia, the United States and Canada, whose subsidies have climbed substantially in recent years. Imagine if those subsidies had gone to renewable energy instead. While it is highly unlikely that the Rome G20 will put an end date for the subsidies, there is a fair chance the leaders will reveal phase-down target dates.

Odds of success (for a phase-down date): Medium

COAL FINANCING: The dirtiest word at any climate-change summit is “coal.” Until coal is eliminated as a fuel to generate electricity, the Paris climate agreement goal of ideally preventing global average temperatures from rising more than 1.5 degrees C over pre-industrial levels will be a lost cause. The easiest way to end construction of new coal plants is to crimp their financing. Ahead of the G20, China led the charge by vowing to cease the state financing of coal plants beyond its borders (though not within them). China accounts for the vast majority of international financing for such plants; Japan, Czech Republic, Russia and South Korea chip in relatively small amounts. The G7 summit in Cornwall, England, in June called for the phase-out of coal use by the 2030s but provided no precise end date. There is some chance, but only some, that the G20 will agree that international financing of coal plants will end by a certain date. The leaders might be haunted by the current energy crisis, where coal is back in vogue in Europe and elsewhere to keep the lights on, an acknowledgment that renewable energy is not yet ready for prime time.

Odds of success: Low

WORLD HEALTH ORGANIZATION FINANCING: The WHO lives on a financial tightrope. Only 20 per cent of its budget comes from assessed contributions from member countries; the rest comes from voluntary donations, which means the agency devotes an enormous amount of time and energy to begging to keep its treasury intact. The shortcomings of the WHO’s funding model have been amply exposed by the COVID-19 pandemic. Various countries, including Canada, support beefing up the agency’s funding model. But it appears that many others do not, for fear of making potentially expensive cheque-writing commitments year after year. They would argue that their own health budgets should come first.

Odds of success: Low