The G20 Summit in Rome: timid and vague, but necessary

On October 30 through 31, 2021, the 16th meeting of the Group of 20 was held in Rome, Italy. With an agreement on a global minimum tax, the G20 countries have found a common position. There was no consensus on climate protection, but determination in the fight against tax evasion. In their first in-person meeting since the outbreak of COVID-19, the heads of state and government of the leading industrialized and emerging countries voiced concerns and raised hopes at the G20 summit in Rome.

Climate change and Environmental protection

The G20 countries want to implement robust actions to limit global warming to 1.5 degrees. The new stipulation is that governments will target climate neutrality as early as the middle of the century. However, countries such as Russia, China, and Saudi Arabia were unwilling to accept 2050 as a confirmed target date for carbon neutrality. There was also no agreement on phasing out coal-fired power generation. However, they followed the announcement of China to withdraw from international financing of new coal-fired power plants.

As for environmental protection, the G20 countries aim to halt biodiversity loss by 2030. At least 30 percent of the land area and no less than 30 percent of the oceans and seas worldwide will be "conserved or protected" by 2030. In addition, there are new measures to end overfishing of the oceans. There will also be an intensification of the fight against illegal deforestation and illicit mining.

Coronavirus pandemic and Migration

The joint fight against future pandemics will be strengthened and financially secured by establishing a working group of G20 finance and health ministers. At the same time, the G20 countries backed the World Health Organization's (WHO) goal of vaccinating 40 percent of the population worldwide by the end of this year and 70 percent by the middle of next year. There were calls for a general transfer of technology and vaccine production in developing countries.

Furthermore, the heads of state and government want to prevent “irregular migration flows and the smuggling of migrants.” What is needed is a comprehensive concept “for safe, orderly and regular migration.” At the same time, they are willing to address the root causes of displacement and strengthen the integration of refugees.

Taxes and Trade

Leaders confirmed the agreement signed by 136 states in October for a global minimum tax on international corporations. It will come into force by 2023. The main aim of the reform is to prevent the shifting of corporate profits to tax havens. Large, internationally active companies will pay at least 15 percent tax, regardless of their headquarter. If a company pays less tax with its subsidiary abroad, the home state can claim the difference.

The G20 countries also committed themselves to an “open, fair, equitable, sustainable, non-discriminatory and inclusive rules-based multilateral trading system.” This action, they said, is crucial for recovery. The World Trade Organization (WTO) will become the centerpiece of this trading system. On the fringes of the summit, the EU and the US also agreed on a provisional settlement of their years-long dispute over special US tariffs on steel and aluminum imports.

Energy and Nuclear weapons

The G20 countries pointed out the need for a secure energy supply concerning the current high energy prices. "We stress the importance of maintaining uninterrupted energy supplies from different sources, suppliers and through different routes, exploring pathways to improved energy security and market stability, while promoting open, competitive and free international energy markets," they said. They agreed that secure supply chains are also crucial to transforming energy systems.

Finally, the US, France, the UK, and Germany called on Iran during the G20 summit to return to its commitments under the Vienna nuclear agreement. The different leaders said that, without a swift return to the agreement, “a dangerous escalation” could loom. At the same time, the US declared its willingness to return to and fully comply with the accord.

Hence, discussions in such a round are laborious and complicated — in the end, they produce compromises that are often highly woolly. Yet, some of the agreements reached in Rome also show that the G20 can reach a common ground and deliver concrete actions against global issues. If some perceive the summit as outdated and ineffective, they should remind themselves that the alternative would be a policy of speechlessness and pure confrontation.

- Florian Heydecker