Financial leaders from the Group of 20 (G-20) leading economies should reduce the number of issues they tackle, agree on measurable targets and set up a permanent secretariat to revitalise their work, a senior European Central Bank official said.
"The G-20 seems to have lost its earlier momentum. The case for acting in unison has diminished now that the most acute phase of the global financial crisis is behind us," ECB Executive Board Member Joerg Asmussen told a seminar on Saturday.
The G-20, which has taken an active role in strengthening the financial system in response to the debt crisis of recent years, came together in 1999 when finance ministers and central bank governors of the world's 20 biggest economies began meeting to coordinate policies and achieve global economic stability after the financial crisis of 1997 and 1998.
The G-20 includes Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, the Republic of Korea, Mexico, Russia, Saudi Arabia, South Africa, Turkey, the UK, the US and the European Union.
Asmussen, a former deputy finance minister for Germany, said that after successes like a coordinated response to a cyclical downturn, an agreement to boost the resources of the International Monetary Fund and reform of how it is governed, the G-20 now needs to reform itself to be more effective.
"First, it is essential to return to a more focused agenda. The G-20 should concentrate on topics where it can bring genuine value added compared to the activities of the formal institutions which, at the global level, deal with economic policy matters," Asmussen said in a prepared speech.
He said the G-20 should focus on financial regulatory reform, tax issues, macroeconomic policies and global financing and cut out additional topics like food security or labour issues.
"My second idea ...is the creation of a permanent secretariat for the G-20. This would help to stay focused and avoid proliferation of new topics, which each new G-20 Presidency introduces, often with limited results," he said.
Asmussen said a small, dedicated G-20 secretariat would foster continuity on technical topics, especially on issues which span over several years, like financial regulation.
"A third idea I would like to advance is that the G-20 should strive towards concrete and measurable objectives for policy action," he said, adding it would help G-20 credibility.
For example, it would have been better to have had a more concrete agreement at the St Petersburg G-20 summit in September on how advanced economies should shape their fiscal strategies after their debt stabilises in 2016 in line with commitments from 2010.
