The Group of 20 (G20) leaders have called for more collective action to achieve strong, sustainable and balanced growth that can be universally beneficial.
In a communique issued at the end of the summit, the leaders agreed that not only do they have to do more to spur growth, they have to make sure that the growth is inclusive and delivers more and better jobs.
The G20 members said global economic growth, hampered by weak demand and structural problems, remains "uneven" and falls short of expectations.
They pledged to remain committed to achieving the goal of lifting the collective Gross Domestic Product (GDP) of the G20 economies by an additional 2% by 2018, an agreement reached at the 2014 summit in Brisbane, Australia.
To do that, the leaders said G20 member economies will continue to monitor the implementation of the commitments and adjust their strategies in accordance with economic conditions.
The summit came at a time when the world has been struggling to materialise a strong, sustainable and balanced growth, with weak trade and falling investment. Some even suggested that a recession is imminent.
Early in November, the Organization for Economic Co-operation and Development (OECD) trimmed its forecast for global economic growth in 2015 to 2.9% and 3.3% in 2016, down from the previous predictions of 3% and 3.6%. The International Monetary Fund (IMF) has also made similar pessimist projections recently.
The leaders said the World Trade Organisation (WTO) is the backbone of the multilateral trading system and should continue to play a "central" role to promote economic growth and development.
"We will continue our efforts to ensure that our bilateral, regional and plurilateral trade agreements complement one another, are transparent and inclusive ... and contribute to a stronger multilateral trade system under WTO rules," the leaders said.
SA on board with expanding economy
In statement after the summit, President Jacob Zuma acknowledged South Africa’s domestic factors that constrain growth and also indicated how the country is resolving these.
He said government was dealing decisively with the energy generation through building coal-fired power stations Medupi and Kusile. South Africa also has one of the largest renewable energy programmes, which currently contributes 2,000 MW and will expand to 6,000MW by 2017/18.
Another sector identified to boost growth is tourism. Zuma said South Africa had changed its approach to the immigration regulations, which will have a positive impact on tourist flows.
“To boost growth, we agreed to redouble our efforts to implement our growth strategies, which we had agreed in Brisbane last year during the Australian Presidency, as well as the Antalya Action Plan we agreed to at this summit. In our case, this means we must accelerate the implementation of the NDP [National Development Plan,]” said Zuma.
The long-stalled Doha round of trade talks has prompted many countries to engage with each other either through bilateral or regional trade arrangements.
Analysts believe that such a trend is not good news for promoting global trade.
To reform the international tax system, the leaders endorsed the measures under the Base Erosion and Profit Shifting (BEPS) project, and urged wide and consistent implementation.
The BEPS rules are designed to attack tax avoidance, improve transparency, close loopholes and restrict the use of tax havens.
According to the OECD, once the project is implemented, companies, especially multinationals, will find it harder to concentrate their profits in low-tax countries and tax havens, a shift that promises to raise up to US$250bn a year in extra tax revenue.
Zuma said South Africa’s officials from the South African Revenue Service (SARS) and Treasury have been working with the OECD on this issue of base erosion and profit shifting.
“South Africa has signed agreements with over 51 countries on the sharing of information on multinational companies. So there will be no place to hide for tax dodgers. Arising from the work of the G20, this sharing of information is going to be automatic,” he said.
On IMF reforms, the leaders said they are "deeply disappointed" with the continued delay in carrying out the 2010 quota reforms and urged the US to ratify these reforms as soon as possible.
Additionally, the leaders also reaffirmed that they will remain committed to boosting job creation, investment and promoting cooperation on eradicating poverty, combating corruption and improving energy efficiency.
Other key issues discussed at the summit that speak to South Africa’s development agenda were energy, youth employment as well as the focus on small, medium and micro-sized enterprises (SMMES.)
With regards to energy, Zuma said this was a very important matter for sub-Saharan Africa and South Africa. The challenge, he said, was finding the right balance between the development ambitions of developing countries with the need to protect the environment.
The G20 leaders said another key issue was the identification of a numeric and quantifiable youth employment target based on national circumstances as a way to reduce high unemployment rates among young people in their countries.
South Africa welcomed the adoption of a target to increase youth employment by 15% by 2025.
Domestically, the achievement of this objective will be facilitated through the National Youth Policy 2020 and the Presidential Youth Working Group, said President Zuma.
“Looking ahead, we believe it would be particularly important for the G20 to also prioritise working to meaningfully address aspects related to equity, justice and dignity as they relate to employment and income distribution.”
The Ministers responsible for SMMEs in the G20 countries also met and agreed on measures to support SMMEs.
The G20 Summit agreed to establish a private sector-led World SME Forum