G20 International Financial Architecture Works As Group Meeting Begins

By Consultants Review Team Monday, 30 January 2023

A G20 International Financial Architecture Working Group meeting will start on Monday, where participants will discuss ways to enhance the stability and cohesion of the global financial architecture and how to make it fit to address global challenges of the 21st century.

The two-day meeting will also focus on exploring ways to provide maximum support to poor and vulnerable countries, Anu P Mathai, economic advisor, department of economic affairs, told the media here on Sunday.

Around 100 delegates from G20 countries, invitee countries and international organisations will participate in the meeting.

Union Minister of Agriculture and Farmers Welfare Narendra Singh Tomar and Minister of Food Processing Industries Pashupati Kumar Paras will inaugurate it, she said.

The discussions during the meeting will be jointly steered by the ministry of finance and the Reserve Bank of India along with France and Korea who are the co-chairs of the International Financial Architecture Working Group. 

"The meeting will discuss ways how to increase the stability and cohesion of the international financial architecture and how to make it fit to address the global challenges of the 21st century," she said. 

Sharing details about the working group, she said it plays an important role in shaping and strengthening global financial architecture on major international economic issues. 

"This group originated in response to the Asian financial crisis. Initially, it was a grouping of the finance ministers and the central bank governors of these countries. 

"In 2008, when there was a global financial crisis, it was elevated to a summit level and it means that the heads of the states of these countries also begin to meet every year," she said. 

This working group particularly deals with how to strengthen the crisis response at the times of crisis, she said. 

Replying to a question, she said the debt is a major item on the agenda of the International Financial Architecture Working Group. 

"Then how multilateral development banks and international financial institutions can be made stronger to meet the funding needs of the challenges of the 21st century like pandemic and climate change. 

"Then the global financial safety net which is a term used for the network of institutions and lending arrangements and regional financial arrangements for increasing liquidity and for providing resources both as preventive measures and in times of crisis. So how can this be made stronger and that is another area which is going to be discussed. 

"There is an issue like what are the implications, macroeconomic implications of the central bank digital currency that is another issue. Then the issue related to capital flows, volatility of the capital flows. So there are the broad areas of the International Financial Architecture Working Group," she said. 

Under the Indian Presidency, there will be a comprehensive look at the global debt situation, she said in a response to a question. 

On the sidelines of the meeting on Monday, a G20 side event titled 'Central Bank Digital Currencies (CBDCs): Opportunities and Challenges' will also be held. 

The event is aimed at sharing countries' experiences and developing a deeper understanding of the macro prudential implications of CBDCs, she further said. 

This working group will meet again in March, June, and September at other places to continue discussions on the priorities set under the Indian Presidency. 

Discussions from the International Financial Architecture Working Group meeting will further inform the G20 Finance Ministers and Central Bank Governors (FMCBG) on the key deliberations on related priorities under India's G20 Finance Track, said an official release. 

The first meeting of the G20 Finance Ministers and Central Bank Governors is scheduled to be held on 24-25 February 2023 in Bengaluru. 

Baldeo Purushartha, joint secretary, department of economic affairs, said the foreign delegates will be apprised of the art and culture of North India through a cultural event. 

They will also be taken to famous sites like Sukhna Lake and Rock Garden in Chandigarh and on February 1, the delegates will be taken to Virasat-e-Khalsa in Anandpur Sahib in Punjab, he said. 

Meanwhile, Chandigarh city has been decked up with national flags of the G20 countries at various roundabouts. 

Guides well-versed in multiple languages will also accompany the delegates when they visit famous places in Chandigarh. 

India assumed the G20 presidency for one year on December 1, 2022. The G20, or Group of 20, is an intergovernmental forum of the world's major developed and developing economies. 

It comprises Argentina, Australia, Brazil, Canada, China, France, Germany, India, Italy,  Indonesia, Japan, South Korea, Mexico, Russia, Saudi Arabia, South Africa, Turkey, the UK, the US and the European Union (EU).

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