Home Views Global Economy

We don’t need the G7: Jeffrey Sachs

Jeffrey D. Sachs
Jeffrey D. Sachs6/18/2021 04:07 PM GMT+08  • 6 min read
We don’t need the G7: Jeffrey Sachs
The latest G7 summit was a waste of resources.
Font Resizer
Share to WhatsappShare to FacebookShare to LinkedInMore Share
Scroll to top
Follow us on Facebook and join our Telegram channel for the latest updates.

The latest G7 summit was a waste of resources. If it had to be held at all, it should have been conducted online, saving time, logistical costs, and airplane emissions. But, more fundamentally, G7 summits are an anachronism. Political leaders need to stop devoting their energy to an exercise that is unrepresentative of today’s global economy and results in a near-complete disconnect between stated aims and the means adopted to achieve them.

But why should those discussions occur within the G7, which has been superseded by the G20? When the G7 countries (Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States) began their annual summit meetings in the 1970s, they still dominated the world economy. In 1980, they constituted 51% of world GDP (measured at international prices), whereas the developing countries of Asia accounted for just 8.8%. In 2021, the G7 countries produce a mere 31% of world GDP, while the same Asian countries produce 32.9%.

The G20, by including China, India, Indonesia, and other large developing countries, represents around 81% of world output, and balances the interests of its high-income and developing economies. It is not perfect, as it leaves out smaller and poorer countries and should add the African Union (AU) as a member, but at least the G20 offers a fruitful format for discussing global topics covering most of the world economy. The annual EU-US Summit can accomplish much that the G7 originally aimed to cover.

Loading next article...
The Edge Singapore
Download The Edge Singapore App
Google playApple store play
Keep updated
Follow our social media
Subscribe to The Edge Singapore
Get credible investing ideas from our in-depth stock analysis, interviews with key executives, corporate movements coverage and their impact on the market.
© 2022 The Edge Publishing Pte Ltd. All rights reserved.