After the Group of Twenty (G20) summit in South Africa this week, the presidency will have rotated through each member country. And its leadership now goes back to the United States at the end of this year to carry forward through 2026. We are in a very different world compared to 2008, when US President George W. Bush hosted the first meeting of G20 leaders in Washington, DC. The world was in the midst of a global financial crisis, and the United States was more willing and more able to uphold a basic structure in the international order.
Today, the question on everyone’s mind is what will an “America First” president and his administration do with the G20 presidency.
The G20 has underperformed on expectations of international cooperation — at least for optimists — during these 20 leader summits, all of which are well documented. While the G20 has delivered some important coordination among countries on the global financial sector and macroeconomic questions through efforts like the Financial Stability Board (chaired by Mark Carney from 2011 to 2018), it has not by itself substantively advanced issues of common global interest, such as climate change, international trade or development assistance.
This year has been particularly bumpy for the G20, with continuing geopolitical tensions putting a damper on general cooperation, and with a full-blown political dispute between the United States and South Africa resulting in the Americans not even sending an official to the Johannesburg summit.
A narrower agenda could help the G20 focus its limited bandwidth.
US President Donald Trump would be wise to take advantage of the “pause” in China-US relations achieved with Chinese President Xi Jinping at the Asia-Pacific Economic Cooperation summit in October to frame a great-power relationship with China that is centred on their common interests, which are primarily economic. The United States would also be wise to forge an agenda for the G20 in 2026 that integrates the growing importance and role of the Global South. The last four G20 summits were held in developing countries — Indonesia, India, Brazil and South Africa — and if these countries do not continue to have strong roles in agenda setting and decision making, the credibility of the G20 will be eroded.
But there is a case for optimism about the G20 next year and beyond. While there is clear skepticism within the Trump administration, there is also a realization that the host can leverage their agenda across the world’s 20 largest economies for a year. President Trump has already announced that he will hold the 2026 summit at his Doral, Florida, golf club near Miami and hinted at a focused agenda through the G20 “Finance Track” on economic growth and innovation, foregoing the longer list of traditional G20 topics.
A narrower agenda could help the G20 focus its limited bandwidth. There are clear common interests relating to international financial stability, unsustainable debt, and improved early warning systems to prevent economic and financial meltdowns. And there are many other global financial systemic risks, any one of which could trigger a crisis. These risks include:
- persistent tariffs;
- chronic fiscal deficits and debt in most leading economies;
- the rise of digital currencies;
- uncertainty in global bond markets;
- exchange rate distortions;
- a likely US stock market bubble; and
- paralyzing external debt in many poor countries.
These issues are systemic global challenges that are central issues for all G20 countries and, indeed, for the world. Given Prime Minister Carney’s deep experience, including as governor of two central banks, there is a significant potential role for him to play. Guiding other G20 leaders toward prioritizing global financial risks could be a galvanizing focus even for countries with otherwise diverse interests.
Bilateral relations are not sufficient to solve, or even manage, global challenges. To manage systemic risks, G20 cooperation is required since there is no alternative set of largest economies. And while the United States — or even a concerted US-China G2 — can’t go it alone, equally there is no G19 or G18 that can sufficiently tackle these global risks. Despite its challenges, the G20 is the right platform for this moment. All the largest powers are there, all regions of the world are represented and a new agenda can be supported by international organizations.
In this turbulent moment, the fundamental issue is trust. Not just trust in a single country or economy, but also trust in cooperation, and in the institutions and processes that maintain stability and growth in the world economy. All members, including the United States and China, have a stake in building that trust by tackling a global economic and financial agenda in the coming year when the United States will lead the G20.
