The Debate

China’s G20 Leadership and the Challenges of Sustainable Development

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The Debate

China’s G20 Leadership and the Challenges of Sustainable Development

China’s own development track record could be an asset in its presidency.

China’s G20 Leadership and the Challenges of Sustainable Development
Credit: Casa Rosada

We are living in a global risk society. Sociologist Ulrich Beck’s notion of a risk society highlights the accumulation of risks – economic, ecological, and security – that we currently face as a global community. Beck argues that there are only three possible reactions to these risks: denial, apathy, and transformation. Similarly, the G20 have three ways to respond to the pressing problems of global development: They can deny the existence of these problems; they can stand idly by and do nothing; or they can innovate their policies and, in so doing, transform the world.

There are three major challenges facing the G20, however. The first is the challenge of an undemocratic global governance system. The United Nations’ structure with its P-5 Security Council members remains an illustrative example of the world’s power hierarchy. Countries like China and India have, of course, repeatedly called for the “democratization” of the international system – to level the playing field for developing and smaller countries and assure their fairer representation in international organizations like the International Monetary Fund and the World Bank.

The second is a challenge once described by Nobel prize-winning economist Joseph Stiglitz, who noted how economic globalization has outpaced political globalization. What this means it that while the world has become closer economically through the proliferation of trade ties, political and cultural barriers remain that prevent the global community from creating and adopting shared norms and values.

The third challenge is that of sustainable development. The world remains starkly divided by a prosperity gap between developed and developing countries, as well as divided by a technological gap. Even now, despite the growing number of people in developing countries gaining access to the Internet – in Africa, for example, the number of people using mobile broadband has risen rapidly –an estimated 3.9 billion people still lack Internet access.

But sustainable development requires more than just economic growth and technological innovation. It also requires the good governance of natural resources and the environment. As development scholars like Jeffrey Sachs and Paul Collier argue, the reasons for why some countries are stuck in a poverty trap, while others succeed, can include corruption, bad fiscal policies, as well as the mismanagement of natural resources.

In this way, the UN’s 2030 Agenda for Sustainable Development is an important milestone thanks to its ambitiousness, comprehensiveness, and inclusiveness. True to the spirit of the UN Brundtland Commission’s report in the 1980s, which first defined sustainable development as “meeting the needs of the present without compromising the ability of future generations to meet their own needs,” the 2030 Agenda highlights the economic and ecological interdependencies facing our world.

Unlike the Millennium Development Goals, the 17 Sustainable Development Goals feature environmental commitments like climate change, forestry protection and fisheries management prominently alongside social and economic ones. It recognizes the responsibilities of both developed and developing countries to poverty alleviation, and it represents a process that was informed (however imperfect) by top-down and bottom-up dialogue.

Although the SDGs are far-reaching and have been criticized for being so, it displays a necessary global ambition. It may not be a major step, considering how it is based on ideas that were articulated in the 1980s, but it is definitely a step in the right direction – as is the Hangzhou Summit’s thematic focus on promoting innovative growth and a global development partnership.

China’s G20 Presidency and Its Potential

China’s G20 presidency becomes all the more important in light of these grand challenges of global governance. As the world’s largest developing country that has so far succeeded in lifting nearly 680 million people out of poverty, China occupies an important position not only as a driver of sustainable development, but also as a bridge between the East and the West, and between the developed and developing worlds. Its presidency thus presents a significant and timely opportunity for China to finally don the mantle of global responsibility, and demonstrate its ability for global leadership.

Given China’s progress at home in introducing policies aimed at galvanizing sustainable economic modernization, there is potential for China’s own model of development to become a model for other industrializing countries. Notwithstanding the fact that China still faces major social and environmental problems – from water scarcity to severe air pollution – it has been a key player in global sustainable development since 1972, when the country under Deng Xiaoping’s leadership first participated in the UN Conference on the Human Environment in Stockholm. China also became one of the first countries to adopt the UN’s Agenda 21 by releasing its own national agenda in 1994. Currently, China is a leader in innovating affordable renewable energy technologies, having emerged as the world’s largest market for wind power.

Globally, China is a major backer of infrastructure and connectivity projects across the developing world. As one of the biggest outward investors among the BRICS countries, China has become a leading – if not the major – investor in developing and transitioning economies such as Venezuela, Ecuador, Cambodia, and Myanmar.

This trend is set to continue in light of the Chinese government’s “new” peripheral diplomacy and its reinvigorated commitment to financing economic development in the global South, as seen from such programs as the “One Belt, One Road” initiative, the Asian Infrastructure Investment Bank, the recent “Six 100s” initiative, and the attendant $2-billion assistance fund for South-South Cooperation.

Infrastructure investment has consistently remained a core concern of the G20 over the past decade – and rightly so. An estimated 13 percent of the world’s population still don’t have access to clean water, while 19 percent don’t have access to electricity. This is a global problem that demands a collective response.

China’s experiences in infrastructure development can, therefore, contribute to the G20’s long-term agenda on enhancing sustainable infrastructure. While Chinese development projects abroad have often been criticized for their negative social and environmental effects (think the controversial oil and gas pipelines project in Myanmar or the Coca Codo Sinclair hydropower plant in Ecuador), the Chinese government has become increasingly proactive in promulgating guidelines on corporate social responsibility to inform the behavior of Chinese investors overseas. Between 2004 and 2014, more than 30 major CSR measures and guidelines were published, including the noteworthy 2013 Guidelines for Environmental Protection in Foreign Investment and Cooperation.

China is in a good position to lead the dialogue and implementation of the G20 Guiding Principles for Global Investment Policymaking, which was previously endorsed at the G20 Trade Ministers Meeting. Because there currently is no international investment regime, effective implementation of these Guiding Principles can potentially become a milestone achievement of the Hangzhou Summit, helping to improve China’s reputation as a sustainable and responsible investor.

Although there are limits to what China and the G20 can do, and skepticism also remains as to what extent the ambitious SDGs can be achieved, the push towards mainstreaming sustainable development in the G20’s policy agenda is critical and should be applauded. The world has high – some may say, too high – expectations for China’s G20 presidency. Yet, looking at China’s development track-record, it clearly has the capacity to meet these expectations. What it needs is strong political will, which hopefully its G20 presidency will inspire.

Pichamon Yeophantong is a Lecturer in International Relations and Development at the University of New South Wales (UNSW), Australia. She also directs the Environmental Justice and Human Rights in Asia Project at the Australian Human Rights Centre.