Eight years have passed since the B20, known as the “Business G20”, met for the first times with the view of providing G20 leaders with proposals for more inclusive development. Since then a number of constructive policies have been put forward, although the main economic and social problems facing the world remain an unresolved challenge. The B20 has not only become a beacon throwing light on how to tackle these challenges, but also plays a crucial role within the G20. It is Argentina’s turn in 2018 to lead this mission.
The B20 this year comprises of eight taskforces that will meet regular to draw up recommendations to be debated at the B20 summit to be held in Buenos Aires October 4-5. These proposals will be put forward to G20 leaders. What are these task forces?
- Trade and investment
- Energy, sustainability and resource efficiency
- Financing growth and infrastructure
- Digital economy and industry 4.0
- Employment and education
- Sustainable food system
- Integrity and compliance
- SME development
Financing for growth
The world currently invests some $2.5 trillion a year in infrastructure related to transport, energy, water and telecommunications. Another $7 trillion is invested each year on social infrastructure (hospitals, schools, urban development), public service network and housing. However, this amount continues to be below the constantly expanding needs of the world, which means lower economic growth and depriving citizens of essential services. The world, therefore, has an infrastructure investment gap.
Why do we need to bridge this gap? Firstly, infrastructure is a critical driver of long-term development. Secondly, infrastructure construction creates jobs. Thirdly, because infrastructure is a multi-trillion-dollar market with enormous business opportunities. However, despite the evident shortcomings and years of debate on the importance of shoring up this investment, the figures show that such spending as a share of GDP has declined in 11 of the G20 economies since the global financial crisis.
There is a wide range of measures governments could adopt, both through direct investment as well through regulatory policies to encourage private-sector investment to close this gap. This is precisely the goal of the ‘Financing growth and infrastructure‘ task force. This group aims to provide very specific recommendations with real chances of implementation and success once put in place.
The B20 is a forum made up of the representatives of global private companies such as BBVA which provides recommendations to the governments of the G20 to meet the most significant challenges on the global economic and financial agenda. BBVA has played a very active role within the B20 since 2015 in Turkey and particularly as a member of the financing growth and infrastructure task force. José Manuel González-Páramo, BBVA Executive Member of the Board and Head of Global Economics, Regulation and Public Affairs, is one of the vice presidents of this group.