G-20 finance chiefs show deep rift over Russia’s war

Apr 22 , 2022. 18 hours ago – 16:41 By Yuka Nakao, KYODO NEWS

Photo taken on April 20, 2022, shows the International Monetary Fund headquarters, venue of the Group of 20 finance chiefs meeting in Washington. (Kyodo)

WASHINGTON – Finance chiefs from the Group of 20 major economies at a meeting Wednesday showed the deep rift that has formed among members over the war in Ukraine, with multiple participants walking out in protest at Moscow’s aggression as Russia spoke.

The discord prevented the officials from having a deep discussion about critical issues such as surging energy prices, food insecurity and the coronavirus pandemic, and, in a rare development, led the gathering in Washington to end without a joint statement.

U.S., Canadian and European delegations left the room when Russian finance ministry officials, including Finance Minister Anton Siluanov who joined virtually, were about to speak at the meeting.

Photo from the Ukrainian Finance Ministry’s Twitter shows Ukrainian Finance Minister Serhii Marchenk (5th from R) standing with members of delegations from the United States, Europe and Canada on April 20, 2022. (Kyodo)

Meanwhile, Russia’s Siluanov urged others in the G-20 to avoid politicizing the dialogue, saying, “The Group of 20 has always been and remains the economic format in the first instance,” according to Tass news agency.

Chinese Finance Minister Liu Kun told the gathering that Beijing opposes the politicization of economic issues, according to the official Xinhua News Agency.

Liu criticized Western countries for imposing punitive sanctions on Russia, saying they “weaponize” the world economy, the agency said.

Among the G-20, Group of Seven industrialized nations are united in imposing a slew of sanctions to isolate Russia from the global financial system, such as by freezing the assets of President Vladimir Putin and the Russian central bank as well as excluding some major lenders from a key international payment network.

In contrast, Brazil, India, China and South Africa, which along with Russia form the BRICS forum, have supported Moscow’s participation in the G-20 framework.

The finance chiefs of the G-7 members — Britain, Canada, Germany, France, Italy, Japan and the United States, plus the European Union — held a separate meeting and issued a joint statement deploring Russia’s participation.

“International organizations and multilateral fora should no longer conduct their activities with Russia in a business-as-usual manner…We regret participation by Russia in international fora, including G-20,” they said.

The G-7 members also reaffirmed their resolve to continue to pressure Moscow to end its military aggression, pledging “coordinated action” to further “raise the cost of the war for Russia.”

The meeting of the G-20 finance ministers and central bank governors took place on the sidelines of the weeklong spring meetings of the International Monetary Fund and the World Bank in the U.S. capital that continue through Sunday.

Just ahead of the G-20 meeting, IMF chief Kristalina Georgieva called for cooperation in the major economies amid tensions among members over the war in Ukraine, while acknowledging it is a “difficult moment.”

The G-20 groups Argentina, Australia, Brazil, Britain, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey, the United States and the EU.

The G-20 finance chiefs, whose nations represent 80 percent of the world’s gross domestic product, had a host of issues on the agenda in their first ministerial-level meeting since Russia’s invasion began in late February.

Surging raw material costs and energy prices have already taken a heavy toll on the global economy, with the IMF projecting this year’s global economic growth to be 3.6 percent in its latest World Economic Outlook report, down 0.8 percentage point from its January forecast.

The tightening of U.S. monetary policy, which began in March as a response to inflation that has been increasing at its fastest rate in more than 40 years, also puts emerging economies’ currencies at risk of weakening and thus causes their foreign debt burden to increase.