Feb. 25-26: G20 Finance Ministers Meet in Mexico’s Capital, Discuss EU Crisis

By
Andres Sada

G20 finance ministers and central bank heads met in Mexico City over the weekend with a clear message for the eurozone: you need to help yourself before the G20 can help you.  IMF head Christine Lagarde warned that the world economy is “still not out of the danger zone” and that the G20 countries must respond with more funds. But, while Lagarde was looking to increase the size of the $500 billion European rescue fund, the non-EU members of the G20 balked at the proposal. U.S. Treasury Secretary Timothy Geithner indicated that the EU must give a more “credible response” by “committing to more than is necessary” before other countries of the G20 pledge funds. The communiqué produced at the summit recognized “important progress made by Europe in recent months,” but cautioned that expectations for global economic recovery remain “modest.” In lieu of any new funds for Europe, Lagarde stated that “concrete decisions” will wait until eurozone meets next month to discuss reinforcing the rescue fund.

The weekend’s events also showcased Mexico’s growing push for improved international leadership. Since assuming the presidency of the G20 for 2012, Mexico has sought to reinvigorate the group with the goal of making it the foremost international forum, more so than the exclusive G7. Mexico has stressed the growing primacy of emerging nations on a global stage, highlighting the notable growth of many of the emerging economies of the G20 in contrast to the poor growth of the G7’s developed economies. At the helm as host of the G20, Mexico seeks to show that it can play a leadership role in resolving global challenges by offering solutions to international problems such as climate change, poverty, and inequality.

Mexican President Felipe Calderón opened the summit by signaling the great responsibility Mexico has taken on by hosting the G20 at such a critical juncture. Calderón touted Mexico’s solid growth and macroeconomic stability, adding that the country is looking to contribute to resolution of the crisis. He outlined that the Mexican agenda for the G20 will include improving the global financial system and financial inclusion, food security, climate change, and green development. Said Calderón: “Mexico wants to take on the challenges of the future, not just those of today.” He emphasized that Mexico’s leadership would be valuable during this crisis, as the country “has learned from its past crises.” Calderón stressed.

Luis Téllez, head of Mexico’s stock exchange, echoed the president’s remarks and suggested the eurozone could learn from the Mexican experience, saying: “While Europe took years to make decisions, we made decisions with the U.S. and the IMF in two months.” Meanwhile, Mexico’s Finance Minister José Antonio Meade pointed to unequal global economic growth, pointing out that emerging economies had seen better growth than industrialized nations. “Environmentally sound policies must be integral parts of G20 countries,” he added. “Mexico has assumed a leadership role in the G20 with the objective of achieving compromises to improve the global economy.”

Learn more:

  • Meeting of Finance Ministers and Central Bank Governors: Final Communiqué.
  • Statement by IMF Managing Director Christine Lagarde on G20 Ministerial Meeting in Mexico City.
  • Mexican President Felipe Calderón addresses the G-20 Ministerial Meeting in Mexico.
  • Press conference with Mexico’s Finance Secretary José Antonio Meade and Mexico’s Central Bank Governor Agustín Carstens.
  • Remarks by Treasury Secretary Tim Geithner at the G-20 Meeting of Finance Ministers and Central Bank Governors.
  • Read an op-ed in Reuters’ “The Great Debate” by AS/COA Chairman Emeritus Bill Rhodes with recommendations for the G20 finance ministers and central bank governors.

Andres Sada is an associate with AS/COA Public Policy Programs.