The G20 Hangzhou summit should create a new order to solve the global economic crisis

Global efforts on growth is on top of the agenda of the upcoming Group of 20 ( G20) summit in Hangzhou, which is a welltimed response to the economic difficulties facing both developed and developing countries.

From September 4- 5, China as host of the Hangzhou summit will work to coordinate a global effort “Toward an Innovative, Invigorated, Interconnected and Inclusive World Economy.”

China’s initiatives are focused on adjustment and cooperation from both developed and developing countries as a means of tackling global economic sluggishness.

This makes it necessary to reform the existing international financial and economic system at a time when longterm stagnation is expected for developed economies, with predicted growth rates for this or the next year downgraded by the IMF for the US, Germany, Japan and Great Britain, all vital influencers of the global economy.

Further economic woes could result from the failure of developed economies to overcome a widening income gap, reduce debt burdens or renew vigor for development after the 2008 global financial crisis, through huge fiscal deficits or large- scale quantitative easing.

The situation has led to criticism of US- advocated neoliberalism and reveals a lack of ideas to drive forward the global economy.

Moreover, it spotlights a need for changes to the rising share of the global economy by emerging economies such as China and India in international economic and financial mechanisms.

A new order is expected to lead to another path toward economic recovery for developed countries by coordinated efforts and a stronger say in the global governance for developing countries. In fact, this is precisely what the G20 was created to do: be an important economic forum for fruitful consultations between the developed and developing countries in jointly coping with global challenges.

A fresh order would also offer more opportunities for developing countries as well as be able to address their specific growth needs.

Additionally, we can expect to see a sharing of benefits from global development including the transfer of new technologies to developing countries and channels for production capacity and investment where they are badly needed.

E- commerce, a hot topic that will be discussed by business figures on the sidelines of the summit, has been suggested as an option to bring down the cost of trade and provide more opportunities for developing countries and small and medium- sized enterprises.

Hopefully, next month’s Hangzhou G20 summit, which represents nearly two- thirds of the global population and whose members account for 85 percent of worldwide GDP, will help the process of global economic recovery.