The group of G-20 countries which includes India has been effective in bringing together “concerted” action that turned around the global economy, US Treasury Secretary Jacob Lew said today.
“If you look at what the G-20 has done over the last eight years, during a time of crisis, it brought together concerted action which had the effect of turning around an economy, a global economy, by seeing trillions of dollars of fiscal policy and monetary policy kick in to get the global economy moving,” Lew said during a discussion at the Council on Foreign Relations.
“The G-20 has been a forum for working through issues like exchange rate policy. Where even four years ago there was a lot of anxiety about competitive devaluation,” Lew said in response to a question.
The G-20 is an international forum for the governments and central bank governors from 20 major economies.
He said that the US can take some credit for having driven that debate in the direction of growth.
“I think we in the US could take some credit for having driven that debate in the direction of growth. And if you look at the commitment the G-20 countries have made to use all policy tools — fiscal, monetary and structural — there’s been a decided change in the last six months. Whether it’s China, Canada, South Korea, countries in Europe — you’ve seen a move toward using fiscal tools,” he said.
He said that in a moment of crisis everyone knows each other.
“There is a group of people who get on the phone, who get on airplanes and go to meetings and can talk with real trust. I think that makes a difference. I think it’s actually been an important stabilising and growth-driving engagement,” Lew said.
“Last issue — climate change. I think if you look at the conversations between the United States and China on climate change has pulled G-20 countries along with it and I think you’re going to see the Paris Agreement go into effect in part because of the discussions that took place in a group like the G-20. So I actually think that to judge the G-20 by crisis standards is to miss its real value during the majority of time when the world is not in economic crisis,” he said.