September 18, 2009

According to the Carnegie Endowment’s Senior Associate, Uri Dadush, the upcoming G-20 Summit in Pittsburgh, September 24-25, which brings together leaders of the largest developing and industrial economies, is the best available option to deal with the post-crisis world. Although he says the G-20 assembly is larger than necessary, “it is nevertheless a big improvement on the G-8, which is not representative of today’s global economy, and on any UN-style universal assemblies, which are far too large to be effective.”

Dadush adds that although the Great Financial Crisis is far from over, a stimulus-triggered recovery is now taking hold. “The contours of the post-crisis economy are already emerging—from the sharply rising public debt levels in most industrial countries to the severely impaired balance sheets of banks and households in countries at the epicenter of the banking disaster, including the United States, the UK, and several smaller European countries. At the same time, China, India, Brazil, and many other emerging markets, which were badly affected at first, demonstrated remarkable resilience in the face of the crisis and have confirmed both their attractiveness as long-term investment destinations and their growing economic and political clout.”

He then outlines four challenges for the G-20 Summit: what kind of recovery; when to withdraw stimulus; how to avoid the same crisis in the future; and, what is the G-20’s long-term agenda.

Read Dadush’s full article here.