Finance chiefs and central bankers from G20 nations — the world’s 20 largest economies — who gathered at the Ritz Carlton in Riyadh on 22 and 23 February, concluded that the downside risks to global economic growth persist amid the coronavirus outbreak that has disrupted supply chains worldwide.
In view of the persisting challenges to economic growth, the economic heads agreed on a “menu of policy options”, but spent much of their time talking about a response to the coronavirus outbreak that originated in China and has so far killed thousands and infected tens of thousands around the world. Countries such as Japan, and institutions including the Organization for Economic Cooperation and Development (OECD), have been pushing for nations with surpluses to spend more to help avert a deeper economic slump.
The countries “agreed to be ready to intervene with the necessary policies related to these risks,” Saudi Finance Minister Mohammad Al Jadaan said on Sunday in remarks concluding the meetings. “Global economic growth is continuing but remains slow and downside risk persists, including those arising from geopolitical, remaining trade tensions, as well as policy uncertainty.”
One of the economic heavyweights behind the call for more spending is Germany. So far, the export-driven country has shown little interest in significantly boosting expenditures, arguing fiscal stimulus cannot bolster foreign demand. Meanwhile, the delegates at the Riyadh G20 managed to extract a key concession from the US by including a focus on climate change in the final communique. The Saudi finance chief called it a “very important issue” on the Saudi agenda.
