The main theme of the Russian G20 Presidency – new drivers of long-term economic growth
Chief of the Presidential Experts' Directorate and the Russian G20 Sherpa Ksenia Yudaeva delivered an interview to the Delovoy Peterburg newspaper.
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Question: Ms. Yudaeva, if you were asked to draw the parallel, what would you compare the G20 with in the world of sports? Is it an economic and political Universiade, the World Cup or the Olympics?
Ksenia Yudaeva: None of the above. The Universiade, the World Cup and the Olympics have more to do with the UN, since these are the competitions that can be attended by athletes from all over the world. The G20 is more of a premier league for economic sports. And it is not a competition, but a platform for political discussion and policy making.
Question: When you read about the decision making process in the G20, it seems like the process is too complicated to take any decision, and all these meetings are held primarily for psychotherapeutic purposes...
Ksenia Yudaeva: Things are complicated indeed, because there are twenty members, while we know that even two people with controversial opinions may find it difficult to agree. However, our experience suggests that the G20 is capable of reaching consensus and drawing precise solutions for the most critical issues, such as, for instance, keeping the situation in Europe from sliding down further to even bigger problems.
In addition, there are many areas of work where our decisions may seem too technical for a man in the street, such as amendments to derivatives trading rules. For many, this may sound vague, but it was a really big step forward.
Question: It's been announced that the central issue of Russia's G20 Presidency is economic growth. Russia itself didn't perform quite well in this regard, growing at mere 1.7% over the past six months. It turns out that Russia has become the proverbial shoemaker going out without shoes?
Ksenia Yudaeva: This issue was actually chosen because economic growth is a truly global challenge nowadays. Our main task is to identify new drivers of long-term economic growth. Both the Russian and the global economies are confronting two overlapping types of crisis. And traditional economic growth models have stalled for several years.
Some economies were growing through consumption, such as the United States and some European countries. The other were growing through exports, such as the Asian countries and Germany. An unbalanced model of this kind yielded fairly high growth rates, but eventually it reached its ceiling. Now we need a new, stable balance. And how would you encourage investment when trust in financial markets has been undermined, and many of the long-term tools don't work? These are the things that we need to discuss.
Question: Speaking of slower economic growth, you noted the other day that the situation has become much more stable than it was a year ago. Perhaps this means that the G20 countries' economy has hit the bottom and that things have stabilized?
Ksenia Yudaeva: First of all, the financial situation has become much more stable. Five or even three years ago, one could argue that the situation in any European country could get even worse at any moment, and there was no mechanism of financial support in operation. Now there is one. What may come about as the problem of tomorrow is the absence of adequate insurance mechanisms in case of problems caused by exit from non-conventional economic policy. History shows us that when the United States and in some cases Germany and the developing countries tightened their policies, that often led to financial strain or crisis, such as the global debt crisis in 1982, the European crisis in 1992-1993, the Latin American crisis in 1995-1996, the South Asian crisis of 1997-1998 and their spillovers in Russia and Brazil. The odds are now we will face a similar situation. Sooner or later, the EU will start adjusting its policies. That will obviously lead to capital outflow from both national and commodity markets.
The full text of the interview you can find here (only Russian version)