Business leaders in Australia Friday called on G20 leading economies to implement recommendations on structural reforms and free trade that could boost global growth by US $3.4 trillion and create millions of jobs. The business chiefs, who are in Sydney for a two-day B20 summit, said their list of 20 recommendations - if adopted by G20 leaders - would help them exceed the 2.0 percent additional GDP target over five years that finance ministers agreed to in February.
"What we are recommending is mostly new structural reform measures that would deliver on the G20 growth target and form a blueprint for sustainable economic growth in the medium-term," B20 Australia chair Richard Goyder said. "If G20 countries commit to these reforms, the gains will be large, but a failure by any of the G20 countries to commit will mean a significant opportunity cost."
The recommendations call for the free flow of goods, services, labour and capital, an effective and transparent regulatory framework, as well as structural reforms that would boost trade and lift infrastructure investment. Moves towards freer trade could boost global GDP by US $3.4 trillion and support more than 50 million jobs across the G20 nations, which "would be akin to adding another Germany to the global economy", the B20 said.
At the same time, increasing investments in infrastructure to fill an estimated gap of between US $15-20 trillion by 2030 could unlock US $6 trillion in economic activity every year and create up to 100 million jobs, the business leaders said. Australian Treasurer Joe Hockey welcomed the recommendations, saying they supported the G20's goal under Australia's presidency this year of driving growth and jobs creation. "These 20 recommendations fit in nicely with our overarching goal," Hockey said.
"The G20 is very focused on how to drive growth and jobs creation, best utilising all of the resources and skills available in the private sector. "In some countries, this is a change of ideology, but necessity has changed attitudes." The senior leaders of some of the world's most high-profile companies, such as Royal Dutch Shell, General Electric and BHP Billiton, also called on G20 governments to tackle fraud and bribery through measures such as introducing or strengthening national independent corruption authorities.
"All of our objectives of long-term sustainable and inclusive growth will be undermined if the level of existing global corruption is allowed to continue," said Michael Andrew, chair of the B20's anti-corruption working group. "It's estimated by the World Bank that corruption constitutes 5.0 percent of global GDP. That would make it the third-largest industry in the world." Hockey said earlier on Friday that he was pushing for a G20 "infrastructure global hub" to support projects as government coffers dry up.
The treasurer said the world's economies needed growth that was not stimulated by ultra-easy monetary policies implemented after the global financial crisis. New ways to drive economic growth included infrastructure projects jointly funded by the public and private sector, he said. "Governments have run out of money to be able to fund the infrastructure needs that the community has," Hockey said. "Therefore we need you, and we need your money, and there is a tremendous amount of liquidity in the world, we recognise that."