The G20 Seoul Development Consensus for Shared Growth
07 April, 2012
The Group of Twenty (G20) comprises 19 countries and the European Union. G20 members account for 85 per cent of the world economy, 80 per cent of global trade, and two-thirds of the world's population. In fashioning a coordinated response to the global economic crisis, the G20 has become the premier forum for international economic cooperation.
The global economic crisis disproportionately affected developing countries—64 million more people are now living in poverty as a result, and there was an estimated spending shortfall of $11.6 billion in 2009 on health, education, safety nets and infrastructure in the poorest countries due to declines in revenue.
Promoting growth in developing countries is critical to achieving the G20's broader aim of strong, sustainable and balanced global growth. The World Bank has estimated that developing countries are now contributing about half of global growth and are leading the recovery in world trade. Developing countries deteriorate more during times of economic downturn than they improve during times of growth. Encouraging inclusive and resilient growth in developing countries is therefore important to both local and global poverty reduction.
The G20 is committed to narrowing the development gap. In Seoul on 11-12 November 2010, G20 Leaders for the first time formally endorsed a G20 development agenda, the 'Seoul Development Consensus for Shared Growth' (the Seoul Consensus). In the Seoul Consensus G20 countries have committed to help developing countries 'build the capacity to achieve and maintain their maximum economic growth potential'—particularly in the areas of food and income security, financial inclusion, domestic resource mobilisation, infrastructure, trade, human resources development, private investment and job creation, and knowledge sharing. G20 Leaders also reaffirmed their commitment to meet the Millennium Development Goals (MDGs) and aid pledges.
The G20 committed to support development through actions including:
- managing and mitigating the risks associated with food price volatility—so that poor people who spend the majority of their income on food are less likely to face food price spikes that mean they forgo other essentials to pay for food
- improving income security in developing countries through enhancing social protection programs to buffer vulnerable communities from future external shocks, and through reducing the costs associated with sending remittances across international borders
- increasing access to finance for the poor—that will assist the more than 2 billion adults without access to financial services to start saving and using credit to establish and manage small businesses
- improving tax administration systems and policies in developing countries—to help build a sustainable revenue base for these countries to fund their own development plans
- facilitating public and private investment in infrastructure in developing countries in sectors where there are bottlenecks
- supporting trade between advanced and developing economies, including through negotiations to bring the WTO Doha Development Round of trade negotiations to an ambitious, comprehensive and balanced conclusion.
The collective economic weight of G20 members gives the forum a unique capacity to tackle development challenges that require a systemic and coordinated response. The mix of developed and developing countries in the G20 creates opportunities to share experience and cooperation across traditional donor / beneficiary boundaries. Coordinated action by the twenty most significant economies on development challenges can make a big difference to poverty reduction in low income countries. The G20 is also reforming international financial institutions, such as the International Monetary Fund, to give developing countries a stronger voice in global affairs.
The World Bank has played an important role in G20 efforts on development, particularly through analysis of the collective impact of G20 members' policies on development and poverty reduction. The Bank will continue to play a critical support role as the G20 tackles the new development agenda.
Prime Minister Gillard welcomed the focus on development [external website], saying 'I did also want to highlight the fact that … development matters will also be discussed at this G20. I believe that that is significant. The global financial crisis has literally thrown tens of millions of people into poverty.'
PDF documents, external website:
Last Reviewed: 19 November, 2010