G20 Comprehensive Growth Strategies: Macroeconomic and Structural Reforms
“We will continue to develop comprehensive growth strategies to achieve stronger, more sustainable and balanced growth in the context of fiscal sustainability.”
– St Petersburg G20 Leaders’ Declaration
The G20 is committed to supporting global economic growth and job creation through the development of comprehensive growth strategies. The G20’s comprehensive growth strategies are intended to lift collective GDP by more than 2 per cent above the current trajectory over five years (with reference to October 2013). They can make a significant difference to the global economy, potentially providing a boost of over $2 trillion to global GDP with the promise of millions of additional jobs.
In their comprehensive growth strategies, members are focusing on macroeconomic policy reforms and structural reforms in the four priority areas of investment, employment, trade and competition.
Macroeconomic policy settings play an important role in creating the conditions that support growth and the G20 is continuing to deepen its macroeconomic policy cooperation. The use of monetary and fiscal policy continues to be an important tool for G20 economies. Central banks in many advanced economies are still using monetary policy stimulate economic growth by lowering short-term interest rates and making money less expensive to borrow. This will return to normal in due course, with the timing being conditional on the outlook for price stability and economic growth.
This eventual development will be positive for the global economy, and reduced reliance on easy monetary policy will be beneficial in the medium term for financial stability. Fiscal policy also has a significant role to play in both safeguarding against risks through rebuilding fiscal buffers, and in boosting the productive capacity of economies.
Structural reforms are an essential complement to macroeconomic policy. Adopting ambitious and comprehensive structural reform agendas offers governments the best chance for a return to strong, sustainable and balanced economic growth that creates jobs and reduces inequality. Structural reforms in the areas of investment, employment, trade and competition have a significant role to play in closing output gaps and contributing to rebalancing growth.
By the time of the Finance Ministers and Central Bank Governors meeting in September, G20 members had identified over 900 measures to improve growth. The IMF and OECD estimate that these measures, if implemented, could achieve 1.8 per cent of the 2 per cent growth goal. G20 members are focussed on identifying additional measures that will achieve the growth goal.
Download the Policy Note Strategies for economic growth.
Framework Working Group (FWG)
(Co-chairs: Canada and India)
The Framework Working Group plays a central role in implementing the Framework for Strong, Sustainable and Balanced Growth, identifying potential risks to the global economy, and helping members to take the actions necessary to strengthen the global economy. In 2014, the FWG has been responsible for coordinating the development by G20 members of their comprehensive growth strategies and for peer reviewing these to ensure that they are robust, ambitious and set out concrete reform measures.
Working group co-chairs from other working groups were invited to participate in relevant sessions of FWG meetings. FWG delegates have worked closely with their national colleagues on other working groups to ensure they were fully coordinating and integrating country input into the growth strategies. In particular, the FWG has worked closely with the Taskforce on Employment to ensure coherence between the growth and employment agendas.
The FWG also plays an important role in assessing current global economic conditions, including potential risks to global growth.
The FWG held four officials meetings during Australia’s presidency: