G20 must coax a reluctant China back into the fold

Nowadays, China seems less interested in multilateral engagement more broadly
However, the world cannot end the pandemic, address the climate crisis or ease the energy-supply emergency without China’s active and positive contribution to the G20

Paola Subacchi

Published: 2:30pm, 27 Oct 2021

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This week, G20 leaders gather in Rome for their annual summit. But will they use their stay in la grande bellezza to reconcile their differences and lay the groundwork for improved policy cooperation?

Will their private dinner reinforce progress, by enabling those who are new to the process – some participants will be meeting US President Joe Biden for the first time – to build relationships with G20 veterans?

Since the G20 became a leaders’ summit in 2008, the private dinner has become an invaluable platform for some of the world’s most powerful people to discuss, face to face, the most important issues that they and their countries are facing.

A decade ago, in Cannes, the euro-zone debt crisis dominated the dinner discussion. This year, there is no shortage of topics that will get the diners talking. The event’s host, Italian Prime Minister Mario Draghi, is keen to discuss the humanitarian and geopolitical situation in Afghanistan; in fact, he recently chaired an extraordinary meeting of G20 leaders on the topic.

The imperative of delivering vaccine doses to low-income countries is also likely to come up – about 23 billion doses are needed, and this requires coordinated effort and open trade for vaccine supply chains. And perhaps guests will consider some form of energy coordination, aimed at easing supply bottlenecks and reducing price pressures.

Of course, anyone who has ever hosted a big holiday party or family reunion knows that some topics are best avoided at the dinner table, lest the affair lose its civility. The coming G20 dinner will be no different, though the stakes are much higher.

Relationships among leaders have historically been what drives progress at the G20, despite struggles to agree on specific commitments or language. The pandemic has been damaging in this respect as well, because the shift to virtual meetings prevented leaders from having the kinds of casual, personal interactions that cement such relationships. Political capital is now thin.

Moreover, in recent years, leaders have become increasingly polarised. So, even as the multilateral process itself has got smoother, progress has become more difficult.

The US and China are barely on speaking terms, and Russia is highly unpredictable. Turkey’s recent threat to expel 10 ambassadors, including four from G20 member states – and the fact that Draghi called Turkish President Recep Tayyip Erdogan “a dictator” – has created further tension.

Italian Prime Minister Mario Draghi speaks during a press conference in Rome on April 8, 2021. Draghi used strong words against Turkish President Recep Tayyip Erdogan and decried the treatment of European Commission president Ursula von der Leyen in Ankara as “inappropriate”. Photo: AP

Finding common ground is essential if the G20 is to remain an effective multilateral forum. Fortunately, Draghi is well practised at navigating competing demands and interests.

To keep disagreements from getting out of hand at the G20 dinner, Draghi will most likely attempt to identify low-hanging fruit – areas of common interest, where coordinated action is most likely.

Chinese President Xi Jinping’s decision not to attend the summit could help in this regard. (Russian President Vladimir Putin will not be there, either.)

But, China’s decision is deeply worrying. Clearly, Xi no longer feels comfortable taking part in a relatively small and unstructured multilateral gathering. He would rather miss a valuable opportunity to meet other world leaders, especially Biden, than risk being ambushed and disrespected. Former US president Donald Trump’s brand of “China bashing” has left deep scars.

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Trump and Xi gather with world leaders at G20 Osaka summit

In fact, nowadays China seems less interested in multilateral engagement more broadly. It used to participate actively in multilateral initiatives, especially on finance and fiscal policy. But cooperation is now particularly difficult in these areas, and throughout Italy’s G20 presidency, China has seemed to lack much motivation to try.

This is a serious problem. We cannot end the Covid-19 pandemic, address the escalating climate crisis, or ease the energy-supply emergency threatening to derail the global economic recovery without China – specifically, without a China that contributes actively and positively to the G20.

Other G20 powers must coax China back, with the US, in particular, adopting a more conciliatory stance. That doesn’t mean acquiescing to China’s every interest or preference.

Rather, it means accommodating China’s changing needs, where possible, as it undergoes a complex and gradual economic and social transition. It also means giving China credit when and where it’s due.

Workers clean in front of the Rome Convention Centre that will host the G20 summit with heads of state from major nations on October 30 and 31. Photo: Reuters

And China has made some effort. One success story of Italy’s G20 presidency is China’s membership in the common framework for debt treatment, endorsed last November, to support low-income countries with unsustainable debts.

Last month, 12 countries formed the first creditor committee, with China as co-chair, to initiate negotiations with Ethiopia, which, along with Chad and Zambia, applied for debt treatment. Most of these countries’ debts are owed to private or Chinese creditors.

This shows that, given the right context and circumstances, China is willing to coordinate with other countries on certain issues. For example, China is not a member of the Paris Club of sovereign creditors, and is reluctant to join institutions that may reduce its autonomy in negotiations with the G7 countries.

China also has specific demands regarding transparency and disclosure. The other G20 countries – including Indonesia, which will begin its presidency next year – should take note of this in attempting to bring China back into the fold.

As for Italy, it has done well during its G20 presidency to keep focus on common goals and limit the pandemic’s impact on proceedings. It has also brought tangible advances, on issues such as open trade, international aid and gender equality.

Now, as its presidency winds down, Draghi should shore up those all-important personal relationships, especially at the private dinner. And, like at any reunion, it should end with a “family photo” of leaders who were glad they made the trip.

Paola Subacchi, Professor of International Economics at the University of London’s Queen Mary Global Policy Institute, is the author, most recently, of The Cost of Free Money. Copyright: Project Syndicate