Landmark agreements forged at the Asia-Pacific Economic Cooperation (APEC) summit have highlighted the G20's inability to address major global issues, a QUT economist says.
Dr David Willis, Financial Economist in QUT Business School, said the APEC summit held earlier this week in Beijing had seen China and the US agree an historic deal to limit greenhouse gas emissions, and the backing of a large Free Trade Agreement (FTA) across the Pacific.
Further negotiations for an FTA between Australia and China also took place at the summit.
"While key economic decision-making happened at APEC, the G20 is more concerned with concentrating on regulation and protectionism and other micro economic issues," Dr Willis said.
"There are no scheduled discussions on climate change on the agenda for the G20, for example, but the two largest economies in the world have just signed a major agreement on emissions."
Dr Willis said the G20 Leaders' Summit, taking place this weekend in Brisbane, was a rare chance to address significant economic and societal challenges and opportunities.
"When you think of the most powerful leaders in the world getting together to discuss world issues, you'd assume they'd be talking about major macro issues," he said.
"Something like climate change is a global issue because it is having an effect on all countries and economies.
"But, unfortunately, the controversial issues are sometimes the ones the G20 shies away from."
Dr Willis said the Australian FTA with China, tipped to be announced shortly, after 10 years of negotiations, could be positive for Australia, but China would ensure it was positive for its own economy.
"It's acknowledged we are entering the Asian Century and China is our major trading partner so it's great from that perspective," he said.
"But the Australian dollar is a floating currency, with its movement depending more on US policy than Australian.
"China, on the other hand, has an adjustable currency, which would be changed to take advantage of trade for China.
"So it's not quite a free trade. China can simply change its exchange rate and ensure it benefits, a point which has been completely missed amidst the hype of this deal.
"This could be a great FTA for Australia, but we should be cautious because China holds all the cards."
Media contact:
Rob Kidd, QUT Media, 07 3138 1841, rj.kidd@qut.edu.au
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