World leaders agreed today to support European efforts to integrate European banking sectors in a bid to support governments affected by the ongoing Eurozone crisis. Heads of state had earlier gathered in Los Cabos, Mexico for the annual summit of the world’s nineteen largest economies as well as the European Union, known as the G20 summit. While the move is expected to assuage fears regarding a renewed recession in Europe, governments progressed slowly on other G20 issues, including taking measures to strengthen global food security.
Recent elections in Greece figured strongly as governments debated whether to stick with austerity measures that have largely been a failure in Europe or to allow indebted governments increased access to funds to increase demand, a move necessary to boost growth and employment in countries stricken by the financial crisis. The outcome document allows for the possibility of such stimulus measures supported by stronger economies, though all indications are that the pace of such reforms will be slow. While conceding that the measures may be slow-moving, IMF head Christine Lagarde insisted that “the seeds of a pan-European recovery have been sown” at Los Cabos.
On other issues, progress seems much slower. The G20 outcome document makes reference to food security, for example, but does not specify new initiatives or policies, instead referring to previous initiatives taken at recent G20 meetings in Korea and France. While leaders claim that the time for new initiatives is not opportune given the ongoing financial crisis, some initiatives to address food insecurity might even save money. According to a group of business leaders who met on Sunday under the auspices of the “B20”, the phasing out of subsidies for the production of biofuels would be one such measure. Biofuel subsidies have been a driver of food price volatility according to a report commissioned by the G20 in 2011 and undertaken by 10 international agencies, including the IMF, WTO and World Bank.
The G20 put their heads in the sand and failed to address the key drivers of food price volatility
said Neil Watkins of ActionAid USA. “Despite the important role played by biofuels production in contributing to food price swings, the word ‘biofuels’ doesn’t even appear in the final communiqué. The G20 ignored the growing consensus – including from the Business 20 – urging them to stop converting food for fuel.”
The host government of Mexico has sought to raise concerns regarding biofuel promotion in the G20, but so far with little success. “The G20 works as a consensus-based organization,” said Francisco Mayorga Casteñeda the Mexican Secretary of Agriculture at a meeting of civil society organizations held in Mexico city last week to discuss issues relating to global agriculture. “Though Mexico has concerns around biofuel promotion, the G20 cannot move forward as long as governments such as Brazil and the United States are promoting biofuels.”
The question of biofuel policy is part of a larger debate on the green economy, one of the buzzwords at the G20 conference. Debates over the nature of the green economy will continue this week in Rio de Janeiro, where many of the same leaders will meet at the Rio +20 Earth Summit. As climate change is on the agenda in both summits, the question of who will pay for much needed technology to assist communities to adapt to climate change will be a topic of debate. Though commitments have been made through the UN climate change negotiations, it is unclear whether rich countries will contribute much needed money to assist poorer countries – who have only recently developed polluting industries and are therefore responsible for only a small amount of carbon emissions – to adapt to the realities of climate change.