Management of Global Public Goods and New Forms of Multilateralism

Since the great financial crisis, the G20 has established itself as the main international forum for coordinating public policy, at least in the economic and financial spheres. Current issues, such as the Covid-19 pandemic and the urgent need to combat climate change, have prompted the G20 to extend its focus beyond financial stability to other global public goods and to address these issues within this analytical framework. At the same time, the consensus required for the G20 to take decisions appears to be increasingly difficult to attain due to geopolitical tensions, even though there has been no noticeable weakening of economic and financial interconnections and the issue of global public goods has heightened awareness of interdependence.

Economic multilateralism has been built up in successive layers and currently suffers from a lack of clarity that sometimes tends towards institutional cacophony because of the large number of institutions involved and the creation of more or less flexible and sometimes competing standards, particularly for the regulation of sustainable finance.

Using climate change as an example, this article calls for rethinking the role of the G20 – especially in the area of finance – in the multilateral order by increasingly relying on coordinating institutions that set standards, such as the Financial Stability Board, as well as on groups like the inclusive forums backed by the OECD that bring together voluntary participants in the quest for an operational consensus around management and financing of global public goods. The G20 should thus see itself as the driving force behind this multilateral network in order to avoid cacophony.