Amid all the drama of an international forum were a few significant moments for world affairs.
The G20 summit, which wrapped up Saturday, Dec. 1, in Buenos Aires, Argentina, produced several key agreements despite concerns international cooperation between countries is fading. The declarations were the results of prolonged and intensive negotiation that preceded the final meeting, which a team of G20 representatives and the G20 finance-track set up.
The G20 is a cooperation forum consisting of the world’s largest economies accounting for 85 percent of the world’s GDP. The members are the US, South Africa, Saudi Arabia, Australia, Argentina, China, Brazil, Japan, Germany, Canada, South Korea, Italy, Indonesia, Mexico, France, Russia, Turkey, India and one regional group, the European Union (EU).
There were agreements regarding the international monetary system, the handling of migration and refugees issue, climate change, agriculture and energy resilience, economy digitization that supports development equality and an inclusive financial system, as well as corruption-related issues and fund flow for criminal acts.
The end of the G20 summit with the theme “Embracing the Opportunities” marked the end of the Argentina presidency this year. The G20 presidency for 2019 is Japan.
Here are five important takeaways from the G20 summit:
The US and China agreed not to institute another tariff on each other: The trade war between the US and China was the most anticipated issue of the summit. Both countries agreed not to impose another import duty and said they are willing to negotiate to reach a new agreement within 90 days.
As Reuters reported, U.S President Donald Trump said Washington will not apply a 25 percent import tariff, targeting Chinese products worth $200 billion starting in January 2019.
Meanwhile, the Chinese government agreed to buy some agricultural, energy and industrial products that are not specific but vital, as stated by the White House.
G20 countries differ on climate change: Again, the U.S. refused to sign on to the 2015 Paris Agreement on Climate. In 2017 Trump withdrew from the historic pact on climate change despite criticism of the withdrawal from environmentalists and other governments.
However, while other nations vowed to comply with the Paris Agreement, none of the G20 member countries’ Nationally Determined Contributions (NDCs) targets were in line with the treaty, as Climate Transparency (CT) stated in its report called “Brown to Green 2018.”
“Currently, nationally determined contributions (NDCs) would lead to a global temperature increase of around 3.2°C. None of the G20 NDC targets for 2030 is in line with the Paris Agreement,” the report said.
NDCs is an effort by each country to lower national emissions and adapt to the effect of climate change, as UNFCCC said.
According to Meliana Lumbantoruan, PWYP Indonesia Program Manager, the G20 countries that dominate 85 percent of the world’s GDP are also responsible for contributing 82 percent of global greenhouse gas emissions.
All call for WTO reform: Global leaders were expected to support reform within the WTO (World Trade Organization) during the G20 summit.
The trade body has become dysfunctional in fulfilling its role to solve trade disputes and monitor global trade.
Washington was displeased with the WTO’s failure to demand Beijing’s accountability for not opening its economy as expected when China joined the body in 2001.
“For the first time ever, the G-20 recognized the WTO is currently falling short of meeting its objectives and that it’s in need of reform,” said one of the White House officials on the sidelines of the meeting.
A win for the US as post-summit report omits ‘protectionism’: The two-day summit produced a post-summit communique that acknowledged the importance of reform in the global trade system. The report, however, left out any reference to the dangers of “protectionism” – a move some are calling a win for the Trump administration which has imposed tariffs as a means to balance trade.
Some experts criticized the weakness of the post-summit statement.
“This is the weakest wording on trade that we’ve ever had,” said Thomas Bernes, a distinguished fellow at Canada’s Centre for International Governance Innovation, to Forbes. “The 19 chose to bury their differences and issue a weakened communique, which raises questions about their ability to show resolute leadership.”
Others hailed the communique, “From my point of view it’s a victory for multilateralism,” said Marcello Estevao, Brazil’s deputy finance minister.
New version of NAFTA signed: The US, Mexico and Canada signed a new trade agreement called U.S.M.C.A. on the first day of the G20 summit. Trump called it a groundbreaking agreement.
The deal is a revised version of the current NAFTA, with significant changes for auto producers, new labor and environment standards, intellectual property rights and several provisions related to digital trade.
Based on the new agreement, cars or trucks must have 75 percent of components manufactured in the US, Mexico or Canada to be entitled to zero tariffs, a substantial 62.3 percent increase compared to the previous deal.
The goal is to increase cars’ spare part manufacturing in North America, by forcing car makers to use parts produced in this region compared to the cheaper parts from Asia.
The most significant change, perhaps, is related to labor protection in the three countries.
The agreement calls for 40 to 45 percent of cars’ components produced by workers who earn at least $16 per hour by 2023. This point specifically targets Mexico and is aimed at increasing wage standards in the country to be adjusted with those of the US and Canada.
That sounds good for Mexican workers, and possibly US workers and the Trump administration which hopes that increased Mexican wages will deter companies from moving factories out of the U.S. to Mexico.