Why Saudi Arabia is an effective member of G20
Leaders of 37 countries attended the G20 summit in Osaka, Japan, from June 28 to 29. The G20 is an international high-level government forum comprising 19 countries in addition to the EU.
The group was founded in 1999 with the EU to discuss policies related to the promotion of international financial stability and address issues that go beyond the responsibilities of any one organization.
The idea of creating such a group arose from the Asian financial crisis, which began in July 1997 and shook the world economy and financial markets. The importance of the group lies in the weight of its members; it accounts for about 90 percent of the gross world product (GWP), 80 percent of world trade, two-thirds of the world population and about half of the world’s land area.
The main themes of the Osaka G20 summit were related to issues of global economic growth, trade and investment, innovation, environment and energy, employment, women’s empowerment, development and health.
The summit was conducted in difficult global conditions, against a backdrop of a trade conflict between the two largest economies in the world (US and China). Political tensions and unrest in the Middle East caused by hostile Iranian behavior toward other countries in the region made discussions at the summit complicated and the issuing of the final statement on the summit a difficult task, especially considering there was some dissatisfaction between countries in establishing principles to lead the world economy in the future.
Since its participation in the 2008 summit at the leader’s level in Washington during the global financial crisis, the Kingdom has had a clear vision on economic growth, especially toward oil market stabilization, which has protected the world from an oil crisis that could affect international economic growth.
In addition to stabilizing the world oil market, Saudi Arabia has introduced its distinct business model, Vision 2030. This is considered a long-term economic blueprint for Saudi Arabia, intended to — through its 13 social and economic programs — to free the Kingdom’s economy from being dependent on oil as a main source of government revenue. The vision also contains a number of initiatives to improve the quality of life in Saudi Arabia and attract foreign direct and indirect investments. The vision has attracted international attention because of its commitment to change and due to the opportunities offered, especially for those interested in investing in Saudi Arabia through the Strategic Partnership Program (SPP).
The Kingdom is a very important member of the G20 group not only because of its oil power but also because of its economic size and also for its contribution to world growth and financial stability.
• Talat Zaki Hafiz is an economist and financial analyst.