G20 finance talks overshadowed by Ukraine end without a joint communiqué

A two-day meeting of finance ministers from the Group of 20 major economies ended in Indonesia on Saturday without a joint communiqué after Russia’s war in Ukraine divided the global forum.

At talks on the Indonesian holiday island of Bali, finance chiefs sought solutions to food and energy crises and accused Russian technocrats of exacerbating the problems.

US Treasury Secretary Janet Yellen, Australian Treasurer Jim Chalmers and Canadian Treasury Secretary Chrystia Freeland on Friday blamed Ukraine’s invasion for sending a shockwave through the global economy.

Instead of a formal communiqué, Indonesia would make a 14-paragraph statement, said Finance Minister of the G20 Presidency Sri Mulyani Indrawati in his closing remarks.

She said there was consensus on most of the document, but two paragraphs would focus on members’ disagreements regarding the impact of the war and the response to it.

“I think that’s the best result,” she said.

At the start of the second day of talks, Governor of the Central Bank of Indonesia Perry Warjiyo urged ministers and global financial leaders to focus on recovering a global economy battered by the Covid-19 pandemic.

The meeting came after the International Monetary Fund cut its global growth forecast, with another downgrade expected this month as US inflation stokes fears of a recession.

But the talks were overshadowed by the Ukraine war after it roiled global markets, caused soaring food prices and contributed to breakneck inflation.

The Kremlin has dubbed the war a “military special operation” and blamed retaliatory Western sanctions for blocking food supplies and soaring energy prices.

Russian Finance Minister Anton Siluanov and Ukraine Finance Minister Serhiy Marchenko attended the meeting virtually.

Russian Deputy Finance Minister Timur Maksimov personally attended the talks, a week after Foreign Minister Sergei Lavrov walked out of a G20 meeting over Western criticism of the invasion.

According to a source on hand, Maksimov was in the room when Western officials voiced their condemnation. Marchenko called for “stricter, targeted sanctions” against Moscow.

Indonesia has failed to disinvite Russia from G20 meetings, including a summit of leaders in November, even as Western nations reiterated calls for Moscow to be excluded from the group.

Both Yellen and Freeland, who has Ukrainian roots, said representatives of Russian President Vladimir Putin’s government had no place at the talks.

Observers said failure to agree on a joint communique would hamper coordinated efforts to tackle rising inflation and food shortages.

“The lack of a communique from G20 finance ministers means it will be more difficult for the G20 to reach consensus on key issues in the fall,” said Eric LeCompte, executive director of Jubilee USA Network, an NGO that campaigns for the debt of Developing countries use aid.

“Internal divisions are hampering the G20’s ability to act and leaving the world in uncharted waters.”

Yellen held bilateral meetings with counterparts from Indonesia, Saudi Arabia, South Africa, Australia, Singapore and Turkey, the Treasury Department said, touting their support for a price cap on Russian oil to slash Putin’s war chest.

In response to the food crisis, the IMF, World Bank, World Food Programme, Food and Agriculture Organization and World Trade Organization also called for action in four areas.

“Support the vulnerable, facilitate trade, increase food production and invest in climate-resilient agriculture,” tweeted IMF chief Kristalina Georgieva late Friday, summarizing the call for action.

Members also discussed sustainable finance, cryptocurrencies and international taxation on Saturday.

Mulyani said “progress” has been made on changes to international tax rules that will set a minimum global corporate tax rate of 15 percent by 2024.