On 18 and 19 June, world leaders sat around the table of the G20 in Los Cabos, Mexico.

During this summit, the G20 states pledged to work collectively to strengthen demands inside their markets and to restore confidence with a view to support growth and foster financial stability in order to create high quality jobs and opportunities for all. The importance of ensuring job creation has been on the agenda of various summits and this has helped to further emphasise the importance of green jobs. The participants also agreed on a coordinated Los Cabos Growth and Jobs Action Plan to achieve these goals to strengthen markets. 

The G20 heads of state or government have held periodic summits since their initial meeting in 2008. The G20 is a forum for international cooperation on the most important aspects of the international economic and financial agenda. It brings together the world’s major advanced and emerging economies including 19 country members and the European Union. Collectively, the G20 economies account for more than 80% of the gross world product, 80% of world trade and two-thirds of the world population.  

The euro area states that are G20 members, namely France, Germany and Italy, stated that they will continue taking all necessary policy measures to safeguard the integrity and stability of the area, improve the functioning of financial markets and break the feedback loop between sovereigns and banks. These states also expressed their willingness to the euro area working in close partnership with the next Greek government to ensure they remain on the path to reform and sustainability within the area.

After the summit, Herman Van Rompuy, the President of the European Council, and Jose Manuel Barroso, European Commission President, issued a statement wherein they expressed their satisfaction that the discussions also focused on the situation in the euro area, and the fact that G20 leaders recognised the value of the European project and of the EU’s currency. “Our partners have recognised that a strong, deeply integrated European Union is decisive for systemic global stability. This recognition mirrors the momentum which is now building in Europe. The EU is determined to show the irreversibility of the euro and of the European project.”

In Los Cabos, the EU again strongly underlined the importance of trade as an important source of growth and jobs. Van Rompuy and Barroso expressed their satisfaction that this was recognised at the summit and that concrete action was identified to further tap into the growth potential of trade. On the European Union’s insistence, the G20 leaders prolonged the Toronto standstill commitment for protectionist measures. This is a commitment to refrain, until the end of 2013, from raising barriers or imposing new barriers to investment or trade in goods and services, and to rectify such measures as they arise.

They also expressed satisfaction with the G20 declaration on further progressing the WTO Doha Development Agenda and benefiting the least developed countries. The G20 also expressed its intention to further strengthen the multilateral trading system.

US President Barack Obama approved the fact that the European leaders pledged to take all necessary measures to safeguard the integrity and stability of the eurozone to prove the functioning of the financial markets, adding that there is a “heightened sense of urgency’’ about repairing the European economies which will include “structural reforms”.

Discussions also centred on the International Monetary Fund. The G20, with the impetus of the ever increasing economic growth of the Brics (Brazil, Russia, India, China and South Africa) countries, has decided to increase its resources to $456 billion, to ensure that it will be ready for any eventual crisis, this should help to create a “firewall” in case of any further crisis. Italian Prime Minister Mario Monti recalled that “the eurozone operates as a more integrated financial architecture that includes banking supervision, recapitalisation and the guarantee on deposits”. The money is in the form of credit assurances and is not actually a cost.

Mauro Miceli is Executive (EU Policy & Legislation), Meusac