Foreign ministers from the Group of 20 (G20) nations arrive in Buenos Aires today for a summit that will mark
Foreign ministers from the Group of 20 (G20) nations arrive in Buenos Aires today for a summit that will mark the continuation of the Argentinian presidency of the group. It is the first time the G20 presidency has rotated to a South American nation.
While expectations of progress on international tax and climate cooperation were expected, there is likely to be considerable concern over Argentina’s request for IMF assistance. The request highlights ongoing risks that emerging market economies face. Argentina’s financial turmoil and the struggle that the Macri government has had in correcting fiscal imbalances over the past year are likely to put the spotlight on other potentially at-risk G20 countries.
With emerging market economies such as Brazil and Turkey facing capital outflows due to rising US and European interest rates, the summit will also be looking to speculation of two additional rate hikes in the US this year. Expect the G20 to continue strengthening its post-crisis financial coordination and supervision, committing to stable exchange rates, free trade and sustainable global growth.
The summit may affirm the G20’s commitment to sustained global growth, with emphasis on free trade. However, expect short-term financial volatility in emerging markets given interest rate uncertainty and investor unease about Argentina’s sudden instability.