On 15-16 February Moscow hosted the first Meeting of the G20 Finance Ministers and Central Bank Governors under Russia's G20 presidency. The event was a major preparatory step towards the upcoming G20 Summit in Saint Petersburg on 5-6 September. Participants discussed a wide number of pressing issues, including "traditional" G20 topics such as global economic outlook, implementation of the Framework Agreement for Strong, Sustainable and Balanced Growth, international financial architecture and regulation reform. Investment financing, government borrowing and public debt management, were also discussed. Three of the most widely discussed issues of global finance today - currency markets volatility, national tax base erosion and profit shifting by multinational corporations were also considered in Moscow and mentioned in the communiqué.
The financial problems that most of the world's big economies first confronted in 2007-2008 are still affecting the global economy. No country can face today's challenges on its own. The time when crises were local and isolated in nature is in the past. The need for collective action places tougher demands on our global governance institutions and calls for closer coordination of economic policy. Examining the relevant institutions, creating new and effective instruments for eliminating the global and regional imbalances that have built up, and stimulating growth in all parts of the world - these are the main tasks for the G20 and for our presidency. The systemic failures in the previous regulatory system that have led to the breakdown of trust, still need to be addressed by the global community, and the G20 should play a key role in these joint efforts.
Russia proposes focusing the G20's agenda on the forum's main tasks: achieving balanced growth and creating jobs. Our priorities are to encourage investment, increase transparency, and make regulation more effective. These priorities make it possible to unite all areas of the G20's work in order to reach the set objectives. We propose discussing development of capital markets and the financial investment instruments used in global trade, examining regulation of the financial sector and its infrastructure at the global and national levels. Employment and job creation, including for vulnerable groups of population, are also important items on the agenda - that is why Russia is planning to host a joint meeting of finance and labour ministers, the first of its kind, in July.
The two additional priorities Russia has proposed to be discussed by the G20 this year reflect our own domestic social and economic priorities. We have intensified our efforts over the past few years to make investment growth the primary driving force in our economy. Structural reforms are making good progress. Together with the business community we are pursuing a national business initiative to follow "roadmaps" for improving the business climate, reduce administrative barriers, and simplify access to financial resources.
We are continuing to develop our financial infrastructure and are putting in place the right conditions for institutions that can put "long money" into the economy. Among the planned reforms is the project to establish a mega-regulator in consultation with the Russian Central Bank, which will be tasked with enhancing financial regulation standards and strengthening market participants' confidence.
We also continue to pay full attention to budget stability issues. Russia has one of the lowest government debt levels in the world. This year the so-called "budget rule" went into effect, designed to make our budget less dependent on oil prices. We are aware of our problems and will work consistently on making the budget process more predictable, and sustainable in the long run.
I want to stress how important the meetings of finance ministers and central bank governors are. By the time the G20 leaders arrive in Saint Petersburg in September, a number of important financial track issues have to be worked through and reported at the ministerial meetings in April and July, such as national medium-term fiscal strategies, long-term investment financing, IMF reform review, 'too big to fail' problem of financial institutions, derivatives markets reform, shadow banking, credit rating agencies, financial indices, OECD's plans on tax base erosion and profit shifting, financial inclusion and others. When it comes to some of the key issues, important to any country today, in current volatile economic conditions, discussions and agreements between the top finance ministers, their views and opinions cannot be underestimated.
Follow Alexander Yakovenko on Twitter: www.twitter.com/Amb_Yakovenko