A big moment at the Group of 20 (G20) Summit, indeed, after the unanimous approval of the African Union (AU) as a permanent member of what is now the G21!

The G20 is (was) a group of finance ministers and central bank governors from 19 sovereign countries and the European Union (EU) and now the AU (the other members are Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Mexico, Russia, Saudi Arabia, South Africa — the AU’s only G20 member with $399-billion GDP — South Korea, Turkey, the United Kingdom and the United States, with Spain invited as a permanent guest).

Formed in 1999, the G20 works to address major issues related to the global economy and promotes global economic growth, international trade, international financial stability, regulation of financial markets, climate change mitigation and sustainable development.

Because the G20 is an intergovernmental forum, not a legislative body, its agreements and decisions have no legal impact, but they do influence countries’ policies and global cooperation. 

Together, the economies of the G20 countries represent more than 80% of the gross world product (GWP), 75% of world trade and 60% of the world’s population.

After its inaugural leaders’ summit in 2008, the leaders of the G20 announced that the group would replace the Group of 8 (G8) as the main economic council of nations. The G20’s ranks include all members of the Group of 7 (G7), a forum of the European Union and the seven countries with the world’s largest developed economies — France, Germany, Italy, Japan, the United States, the United Kingdom and Canada.

Formed in 1975, the G7 meets annually on international issues, including economic and monetary matters. Apart from being older than the G20, the G7 has sometimes been described as a more political body because all of its meetings have long included not only finance ministers but chief ministers, including presidents and prime ministers.

However, the G20, since the global financial crisis of 2008, has increasingly held summits that include political leaders as well as finance ministers and central bank governors. And where the G7 exclusively comprises developed countries, many of the additional 12 nations that make up the G20 are drawn from those with developing economies.

Indeed, having a forum at which developed and emerging nations could confer was part of the impetus for creating the G20.

G20 — whose side are you on?

Since its inception, some of the G20’s operations have drawn controversy. Concerns include transparency and accountability, with critics calling attention to the absence of a formal charter for the group and the fact that some of the most important G20 meetings are often held behind closed doors.

Some of the group’s policy prescriptions have also been unpopular, especially with liberal groups. Protests at the summits have, among other criticisms, accused the G20 of encouraging trade agreements that strengthen large corporations, of being delinquent in combating climate change, and of failing to address social inequality and global threats to democracy.

The G20’s membership policies have come under fire, too. Critics say the group is overly restrictive and its practice of adding guests, such as those from African countries, is little more than a token effort to make the G20 reflective of the world’s economic diversity.

Former US president Barack Obama noted the challenge of determining who can join such a powerful group, saying, “Everybody wants the smallest possible group that includes them. So, if they’re the 21st largest nation in the world, they want the G21 and think it’s highly unfair if they have been cut out.”

Indian Prime Minister Narendra Modi on 9 September welcomed the AU as a permanent member of the G21 during the first day of the multilateral summit in New Delhi.

This is a powerful acknowledgement of Africa’s GDP, estimated at roughly $3.1-trillion, and its 55 member states (which include disputed Western Sahara). The continent has a young population of 1.3 billion which is set to double by 2050 and make up a quarter of the planet’s people; it’s home to the world’s largest free trade area and rich in the resources the world needs to combat climate change, which Africa least contributes to but is most affected by; and it has 60% of the world’s renewable energy assets and more than 30% of the minerals key to renewable and low-carbon technologies (Congo alone has almost half of the world’s cobalt, a metal essential for lithium-ion batteries).

Long road to acceptance

The timing could not have been better as Africa continues to seek a more important role on the global stage and presses for meaningful roles in the global bodies that long represented a now faded post-World War 2 order, including the United Nations Security Council.

Africa also wants reforms to a global financial system — including the World Bank and other entities — that forces African countries to pay more than others to borrow money, thereby deepening their debt.

Modi presented the welcome news to the current AU chairperson, Comoros president Azali Assoumani, who succeeded Senegal’s President Macky Sall, who both helped to push for G20 membership. 

The AU had advocated for full membership for seven years, with US President Joe Biden last year also supporting the AU’s permanent membership in the G20, saying it’s been “a long time in coming”.

Calling the AU’s inclusion a “significant stride”, Modi said this paves the way for a “more inclusive global dialogue”, adding that collaborative efforts among the G21 nations will “benefit not only our respective continents but also the entire world”.

Africa unity

Africa is increasingly courting investment and political interest from a new generation of global powers beyond the US and the continent’s former European colonisers. China is Africa’s largest trading partner and one of its largest lenders. Russia is its leading arms provider. Gulf nations have become some of the continent’s biggest investors. Türkiye Cumhuriyeti’s (Republic of Turkey) largest overseas military base and embassy are in Somalia. Israel and Iran are increasing their outreach in search of partners.

African leaders have impatiently challenged the framing of the continent as a passive victim of coups d’état, war, extremism, drought, hunger and disaster that is always pressured to take one side or another among global powers. Some would prefer to be brokers, as shown by recent African peace efforts, especially in the unprovoked, unwarranted and unjustified Russian invasion of Ukraine.

Therefore, granting the African Union membership in the G20 is a step that recognises the continent as a global power in itself. 

African leaders are tired of watching outsiders take the continent’s resources for processing and profits elsewhere, and want more industrial development closer to home to benefit their economies.

Africa has never been a poor continent — only poorly managed. 

The AU’s rotating chairmanship, which changes annually, also gets in the way of consistency, but Africa will need to speak with one voice if it hopes to influence G21 decision-making.

African leaders have shown their willingness to take such collective action, such as during the Covid pandemic when they were united in loudly criticising the hoarding of vaccines by rich countries and teamed up to pursue bulk purchases of supplies for the continent.

Now, as a high-profile G21 member, Africa’s demands will be harder to ignore. The 2021 G20 Summit was held in October that year in Rome and some of the topics included supporting small and medium-sized enterprises and women-owned businesses, the role of the private sector in the fight against climate change, and sustainable development.

Previously, the 2019 G20 Osaka Summit focused on the global economy, trade and investment, innovation, the environment, the just energy transition, employment, women’s empowerment, development and wellness.

Similarly, in 2018, Argentina proposed a focus on the future of work, infrastructure for development, and a sustainable food future. That meeting also included talks on the regulation of cryptocurrencies and the US-China trade war.

Economic corridor

Some of the more significant outcomes were when Modi, alongside European Commission President Ursula von der Leyen, Joe Biden and Saudi Arabia’s Mohammed bin Salman announced an economic corridor connecting Europe with the Middle East and India through a combination of rail and sea routes, during a session at the G21 Leaders’ summit.

The proposed corridor aims to establish seamless trade routes and ports connecting India, Saudi Arabia, the United Arab Emirates, Jordan, Israel and the EU. Known as the Partnership for Global Infrastructure Investment, this project has the potential to accelerate trade between India and Europe by up to 40%.

Moreover, it could contribute to the normalisation of relations between Israel and the Gulf states, aligning with the goals of the Biden administration. 

It could increase prosperity among the countries involved through an increased flow of energy and digital communications, help deal with the lack of infrastructure needed for growth in lower and middle-income nations and help turn the temperature down on turbulence and insecurity coming out of the Middle East.

Also, the Global Biofuel Alliance has received major recognition thanks to a G21 announcement. This programme encourages international cooperation among member countries while promoting sustainable biofuels, notably in the transportation sector.

Many G21 nations have expressed interest in joining this alliance. The production of biofuels from biomass or organic materials has the potential to lower greenhouse gas emissions and help the world reach net-zero carbon emissions.

With organisations like the Global Biofuel Alliance, there will be chances for deeper collaboration with nations like Brazil. The Indian Minister of Petroleum and Natural Gas and Housing and Urban Affairs, Hardeep Singh Puri, first announced this forward-thinking cooperation during India Energy Week 2023 in February.

Its main goals include promoting global commerce in biofuels, developing the biofuel market, offering technical assistance to national biofuel programmes worldwide, and exchanging policy information. 

It is crucial to note that the alliance will work in conjunction with current regional and international organisations and projects in the fields of bioenergy, bioeconomy and the broader just energy transition, such as the Clean Energy Ministerial Biofuture Platform, Mission Innovation Bioenergy initiatives, and the Global Bioenergy Partnership.

Notably, the United States, Brazil and India — the world’s top producers and users of biofuels — will lead the establishment of the Global Biofuels Alliance with other interested countries.

This collaborative project will strongly emphasise sustainability, market expansion and information exchange to advance the use of sustainable biofuels globally, having succeeded in making it a top priority during India’s G20 presidency. 

To help create a greener and more energy-efficient future, members of the alliance will rely on the best practices and success stories already used in the industry. DM