A candidate aspiring to take any competitive exam should be update with the current affairs as it will be useful during the recruitment procedure. The current affairs section is a vital part in the banking sector as this section is present in the bank exam.This current affairs article gives the candidate an idea of the Financial Institutional Reforms of the G20 Summit Highlights.
The 11 G-20 summit for two days was conducted on 4th and 5th September 2016 in China. The Chinese trade lacked in the right strategy and exporters, which are the reason, why there were huge expectations from this G-20 summit held in Hangzhou.
At the recent G-20 summit, the world leaders highlighted their nation’s concern where the majority of them demanded cooperation in order to resolve those primary issues. The factors such as income inequality and tax avoidance were the limelight so deserved more attention. The main topic, which was not discussed and was not given enough importance, was the domestic investment.
The international investment was promoted to the extreme where the bond of working together fell short. The banking sector in each nation apart from USA, Russia and China is not at its best. Several developments in the process of recruitment, examination process and selection, as well as provisional allotment, needs to work on. Central banks could have made a deeper impact in terms of their monetary policy.
There are major issues as well like economic stability and financial governance of the nations, which got resolved by the concerned authorities. This was 11th G-20 summit, which had its own plan that was put forward for the development.
Background of G-20 summit:
- G-20, founded in 1999, is one of the powerful group in the world.
- It was launched in Washington D.C to work on the financial crisis of 2008.
- The Global economic condition was again made stable, from the economic crisis of 2008, by G-20.
- The aim of G-20 is to address the financial issues all over the globe and look after the cooperation of its members.
- The theme of G-20 summit was ‘Blue Print on Innovative Growth’.
- It consists of the 20 main economies of the world.
- G-20 contributes the maximum percent of the total GDP of the world.
- It contributes 80% of the trade volume.
- There are 11 summits conducted so far.
- USA chaired 1st G-20 summit
- Turkey chaired 10th G-20 summit
- Germany chaired 12th G-20 summit
- India or Argentina will chair G-20 summit in 2018
Decisions which are taken in Hangzhou G-20 Summit:
- President of China, Mr. Xi JinPing, chaired 11th G-20 summit by delivering his opening speech.
- The theme of the summit is ‘Towards an innovative, invigorated, interconnected and inclusive world economy’
- Macro policy coordination and communication is reinforced
- To enhance economic governance and global finance for the overall economic growth of the world.
- To revitalize trade to build an open economy along with international investment.
- Promotion of inclusive and interconnected development
- Plan to achieve 2030 agenda for sustainable development
- To support the industrialization process of least developed countries and African nations.
- Full efforts to bring the world economy back to a strong position.
- Hangzhou summit has transformed G-20 to a long-term governance mechanism from a crisis response
- Mr. Narendra Modi, the Prime Minister of India, also attended G-20
Meeting of G-20 Finance Ministers and Central bank Governors:
- This meeting was held in Washington D.C on October 6, 2016 before G-20 summit
- This is the second and last meeting under China’s leadership
- Mr. Lou Jiwei, China’s Finance Minister and Mr. Zhou Xiaochuan, Governor of PRC co-chaired the meeting.
- Mr. Arun Jaitley, the Finance Minister of India, attended the meeting.
Reforms of Financial Institution:
- The agreement was to continue voting right reforms for the development of emerging nations and quota of international financial institutions.
- Quota reforms are to be administered by IMF or “International Monetary Fund”
- World bank will undertake the voting power on share
- A joint drill of risk response will ensure the regional and international financial safety
- Major cooperation in combating tax evasion among world nations
- To establish an international tax policy research center in china
- Agreements and measures to increase cross-border trade and investment to improve economy of the world
- The members of G-20 have come to an agreement to support the trading system.
- The first ever guiding principles for global investment policy got released
- Much importance is given to multilateral rules that govern the international investment
- High-level principles on individuals responsible for financial corruption got formulated by G-20 leaders where if found guilty, the corrupt officials will be punished severely.
- 2017-2018 anti-corruption action plan will be formulated.
- Strong point made on asset recovery from willful defaulters
- Fugitive repatriation and asset recovery reviewed.
Areas need to be focused:
- The main aim of G-20 is to unite the nations for success
- The recent problem between USA, Russia and China in trading and difference of opinion on several international problems is an area, which needs to be focused on.
- China’s rivalry with India and supporting Pakistan is a factor to be worried.
- Instead of differences among nations, they should cooperate in implementing the plans of the 11th G-20 summit for the overall global financial development.
The banking sector will also be improved and there will be efficient operation in terms of monetary policies along with economic development.
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