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This week on #WooSays, Faye Kwan speaks with Professor Emeritus Datuk Dr Woo Wing Thye about the dramatic implications of the United States’ absence from the latest G20 Summit. As the forum’s traditional leadership weakens, is the G20 evolving into an institution increasingly shaped by the Global South?
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00:00Hello and welcome to WooSys, where we get real about the US, China, everything and everywhere
00:16in between. I'm Fei Kuan and today we'll be taking a closer look at the G20 Leaders Summit
00:22in Johannesburg, South Africa. What happened or rather what didn't happen? This year's summit
00:27of course is unfolding at a rather difficult moment for global diplomacy with rising tensions
00:34between will powers over Russia's war in Ukraine as well as uphill climate negotiations at COP30.
00:40But of course the biggest headline at the summit is arguably the absence of the United States.
00:47So what does all of this mean for the future of the G20? To help us unpack all of this,
00:52I'm joined by none other than Professor Emeritus, Datuk Dr. Wu Wing Tai. Prof, thank you so much
00:58for joining us today. Glad to be here. Now firstly, I think we have to address the elephant in the room.
01:07Absence really speaks more than presence in this case. The US was not at the G20 Summit this year.
01:15What do you make of Trump's decision not to attend the event and what does it signal about
01:20Washington's global posture right now? Well, it's too early to say what we see is the permanent
01:30position of the United States in its foreign policy. What we see is a break with US tradition and this break
01:41in US tradition is not just not going to G20, it's not going to COP30 as well. The G20 was first
01:53convened in the fall of 2008 after the global financial crisis started in September with the collapse of Lehman
02:07the G20. It was called by President Bush largely because he recognized that the G7 did not have the economic muscles
02:20to prevent a collective collapse of the world from the financial crisis. So the origin of the G20
02:29was economic in nature. Now, this refusal to attend G20 is certainly a bad sign because it's hard to make
02:41global progress without the participation of one of the two most important economies in the world.
02:49So there is a silver lining to that dark cloud, however, which is that the rest of the world got together
03:02and uniformly proclaimed that they wish to continue global governance along the UN framework that was designed
03:14by the United States in 1945. And they would continue meeting on the G20, which was convened by the US in 2008.
03:26So the US may be gone, but the rest of the world seems perfectly happy to embrace the world,
03:34the global architecture that the US had put up after 1945.
03:39So would you say then that it's more of a deliberate signal to disengage from this sort of multilateral
03:47leadership that other other G20 member states are part of, or is it more of a tactical move domestically
03:54on Trump's side? It is definitely more of a domestic consumption, largely because the rest of the world
04:04continues to continue to move on. For example, as you know, it is official US government policy that the
04:11word climate change must not appear in any common case of a conference that the US is a participant in.
04:20And if you look at COP30, and if you look at the G20 declarations, environmental concerns
04:28were a very important part of the statement. So it is that Donald Trump is acting up for his base.
04:41But the more important thing is, what will happen next year? Because the US assumes the presidency of the G20.
04:50Yeah. Now, this is an occasion where Donald Trump could dominate the airspace, the airwaves of the world.
05:04His face will be seen everywhere with the other leaders. And I think this is something that he might find
05:13it very hard to let go of this publicity opportunity that works next year.
05:21But of course, it depends very much on what else unfolds between now and fall of next year.
05:32Yep. Definitely. And we know that under a Trump presidency,
05:36it is to expect the unexpected. Things are very unpredictable.
05:40I would like to tap a little bit more on the US hosting the G20 next year. But firstly, you mentioned
05:46how climate change was such a big part of both COP30 and the G20 declaration. And that declaration,
05:54especially the G20 declaration, it was talking about climate adaptation, renewable energy,
06:00even relieving debt for poorer nations despite US objections. So do you think this marks a sort
06:06of a shift where the global self is asserting a little bit more collective influence on the group?
06:12I think the global self is trying to push the original mission of the G20. The original mission of the G20
06:26is to maintain global prosperity in the midst in the wake of a financial crisis. And the most important,
06:36the most detailed parts of the declaration have to do with economic construction. For example,
06:45when it talks about climate change, it focuses very much on how to finance the investments of the global
06:56self in order to undertake the energy transition. Like Anwar Ibrahim talked about, we've got to support
07:05the SMEs in particular because the SMEs are the future big firms of the country. And in order to export to global markets,
07:21we must produce in an environmentally friendly way. And so global climate finance architecture is very
07:31important. And that is part of a broader issue, which is how can we make the global financial system
07:42responsive to the investment opportunities that actually exist in the global self? Specifically,
07:53the global self, the wealth of global self could be unlocked if the right infrastructure investments
08:03are put in place. But infrastructure investments by their nature, they don't pay, they don't have,
08:11the payoff comes 30 years or 20 years after the investment is undertaken. It's just that you put up the
08:19first power line, the first power line, you're not going to get a lot of development. It's only after you've got a network of power lines,
08:26then you have got a big increase in economic activities. So given the long horizon nature of investments,
08:37financial institutions right now, the commercial financial arrangements are still too short-sighted
08:50in their lending. They lend for five years, they hardly lend for 30 years. This is what investment finance is.
08:58And so one part of the declaration is to improve the effectiveness of multilateral development banks like
09:12the World Bank, the ADB, largely because they are the ones that are capable of borrowing long term in the market
09:24at cheap rates. And they can only do so if their capital base is expanded. And so one thing that came
09:36up very clearly is we need to expand the capital base, the multilateral banks. Not only would they be able to
09:43fund infrastructure better, they will also be able to fund the climate, the green investments that are needed
09:53the transition to environmentally friendly production techniques.
10:00You mentioned a big key with the effectiveness which made me wonder just how effective is a declaration
10:06such as this to move our global financial systems, our global institutions in that right path? How effective
10:13is a declaration such as this without US involvement and agreement to be part of it given that it's one of
10:19the two biggest economies in the world? Yes, what we need to do is to first have agreement on what needs to be done.
10:30And when the persons, the countries that have been blocking it from happening change their mind, then we can move
10:38ahead very quickly. And even then, this can be done on a regional level. For example, Asia, East Asia in particular,
10:52has a number of very rich countries. And East Asia should certainly be able to set up a much bigger
11:02multilateral development bank than the Asian development bank. The reason why the Asian development bank
11:11is not bigger is because the United States has prevented it from expanding its capital base.
11:19Actually, because the US was not willing to put more money into ADB.
11:24As the Japanese, the Chinese, the Koreans are all have always asked to be able to do it.
11:34So I am very optimistic that this first you got to get agreement on what needs to be done.
11:44So that when the time comes, you can take off and get the job done properly. So you could have plans,
11:52you could have plans. So this is more consensus building exercise. But it's very important that we
11:57have only one country that is blocking it. The other big economic issue that was raised was the
12:05declaration against unilateral protectionism that is against the rules and regulations of the WTO.
12:15So on the surface, this seems to be just a slap at the United States for its unilateral trade actions.
12:24But it's actually more subtle than that. It's also an indirect rebuke of China.
12:30Because one important part of the declaration was that there should be reliable supply chains in critical minerals.
12:44And when we see the word minerals, we think of rare earth.
12:49So they are saying the Chinese should not weaponize rare earth just like the way the Americans have weaponized their trade, their international trade, their imports.
13:06So you could see that it is not a complete reject. It was not an occasion where everyone dumped upon the US. Let me put it that way.
13:22And in a way, the host South Africa was very, very clever. It did not focus attention away from some very difficult issues in order to allow progress on other important global matters.
13:45But what did they look away from? They look away from peace, which is what the ultimate goal of the United Nations is, is peacekeeping.
13:57That Nobel Peace Prize.
13:58That's right. And the other thing was the Ukraine-Russia war is the other big elephant in the room.
14:10And clearly, there are more people, more Europeans and G7 members there, who are all united in supporting Ukraine.
14:27So I think Anwar got it right when he talked about this issue in very decolonization language.
14:38Basically, he said there shouldn't be proxy wars like the one you see in Sudan. Sudan is a civil war where each site is funded by a different external agent.
14:55And if you look at the Ukraine, Ukraine would certainly have been defeated, if not for arms from the Europeans and the Americans.
15:05So we have to think of a way of ending proxy wars.
15:15But the important goal, which I think everybody supports is there should be no adjustment of borders through the use of force.
15:26So that and to be fair, we talk not only about Ukraine, we also talk about Palestine as well as the Sudan and the Democratic Republic of Congo.
15:42So peace was an important part of the proceedings, but it did not get the main focus because the main focus remained on the original goal of the G20, which is producing and maintaining economic prosperity.
16:06prosperity.
16:07Now, you said, of course, it all depends up until the next G20 gathering, what happens in these coming months.
16:16However, the U.S. will be taking over as host next year.
16:22So on one hand, you have South Africa steering the bloc into this direction and then the U.S., as you've mentioned, their emphasis on peace.
16:34The White House spokesperson here has said that Trump looks forward to restoring what they've described as legitimacy to the G20 next year.
16:44Are there any sort of reversals or changes you think we can expect?
16:47And is that going to just set the whole group for backwards again?
16:53I think it would be very hard to have reversals because, as you notice, 19 of the 20 showed up.
17:06And now it's hard.
17:08The world has changed.
17:10That's what Donald Trump did not understand when he launched the trade war.
17:17It's just like he thought by blocking the U.S. market off from China, China would cave in.
17:29And that China did cave in to a large extent during his first term.
17:35But right now, China has got even bigger since his first term, such that when he tried the same measures again, the Chinese just tightened its chokehold on red earth.
17:52Basically, the U.S. is no longer in the position of the boy who says, I don't like you guys, so I'm taking the football home now.
18:05Basically, the other people are also bringing footballs to the soccer field, so you can bring your ball home and we'll continue playing with the other balls.
18:19So the U.S., in a way, this has been a awakening for Donald Trump, the trade war.
18:25He blundered into it, totally unprepared.
18:29And I think he doesn't see any of these things as permanent.
18:39For example, he just met Soran Mamdani in his office in Washington, D.C.
18:48And during the campaign, you know, he called Mamdani a communist, and Mamdani called him a fascist.
18:57And there they were standing in the Oval Office together, and a right-wing reporter asked,
19:04Mr. Mamdani, how do you feel like standing next to a fascist?
19:09Mamdani was caught short of words, and Donald Trump put his arm around Mamdani and said,
19:17It's okay, you can call me a fascist, I don't mind, you can do that.
19:22So you can see, he loves a successful conference.
19:30So if he does host one, my prediction is he either hosts a successful conference,
19:37or he will refuse to host it at all, and the chairmanship goes to the next country.
19:44Nobody wants to host a meeting where you end up looking bad.
19:51That is, you know, scoring your own goal.
19:56Now, being friendly to a Democrat versus being friendly to other global powers,
20:03China especially, I like your football analogy, but where does Beijing sit in this football field then?
20:13You know, what, or could Beijing sort of benefit from this slightly divided G20 US against the rest of the world?
20:22You would notice that China did not attempt to dominate the G20, nor did it attempt to emerge to be the leader in COP30.
20:37It could have easily created the image of a new leader emerging if it has launched some new program that it would finance.
20:52In other words, it said, if the US won't do it, I'll come forward and I'll put down my money and do it.
20:59But no, it did not. Basically, it says, let's continue to play soccer, and I'm not going to change the existing rules.
21:08Now, this is a change for China in practice, because as you know, China has been one of the biggest violators of WTO regulations.
21:22When it joined WTO in 2001, it signed on to a raft of agreements that it's supposed to implement, which it never has after 25 years.
21:39But now China has come up to say, OK, I'll now start playing by the rules that I had agreed to.
21:46So it's just playing the responsible.
21:51But, you know, how you judge China for the preceding 24 years of non-adherence of rules?
22:00But now China has realized that it has to take on the responsibility, but without having to look like it has etched out the US.
22:12There's no need to. The US has removed itself, clearly, to all.
22:20And that's why I think the Chinese wants to project itself as a status quo power.
22:30In other words, we are not interested in the territories of other countries, except for the breakaway province of Taiwan and our borders on the South China Sea.
22:50So I do not see that the Chinese have no intention of dominating G20 so much such that it becomes a non-workable forum.
23:07It will cease being a global forum.
23:11Right. And that that will be good in terms of giving other countries a platform to voice them to for their voices to be amplified.
23:22Right. In between these global superpowers, though, there's China, there's US, the global South.
23:29There's also ASEAN, where Prime Minister Datuk Suyanwar Ibrahim, as you've mentioned, he was invited in his capacity as ASEAN chair.
23:37Of course, it's also part of his deepening ties with Africa and his three-country African tour.
23:42But how do you see ASEAN's role evolving with this current G20 that we have?
23:50Well, I think it is very important because other than Indonesia, each of the other ASEAN country is pretty small.
24:04And if we are able to forge a common agenda, we will be stronger to stand as a regional bloc.
24:15Just like at this G-meeting, at this meeting of G20, it officially became G21, actually, largely because the African Union joined as a permanent member of the G20.
24:35So it would not be, as the European Union is also a permanent member of the G20.
24:46And if you look at ASEAN, ASEAN has a population the same size as Europe, which means that after we have caught up in economic growth,
25:05we will be as rich as Europe.
25:08So that could be a potential G22 in the offing.
25:14Right.
25:17That would definitely be something very interesting to see.
25:21Before we wrap up, though, Prof, I just have a final question for you.
25:26In what we've seen in the last few days, the U.S. absent from the summit, South Africa defiant and more assertive,
25:34China recalibrating its role, not necessarily coming in as a saviour for everyone,
25:40and then ASEAN as well with its growing potential, is the G20 still fit for the purpose that it was built for?
25:47You've mentioned that they are trying to go back to its original economic purpose and its economic roots,
25:54or is the G20 evolving into a very different institution today?
25:58Well, G20, over time, naturally, naturally, the louder and louder voices will be the global south,
26:13largely because the global south is the parts of the world that are growing quickly.
26:21So, in a way, the UN is too big an organization to coordinate.
26:30The G7 is easier to coordinate, but it lacks the economic muscle to be able to navigate the whole world on a good trajectory.
26:45The G20 would have the economic muscles to be able to place the world on an economic trajectory that would lead to common prosperity.
26:58And more than that, the G20 also encompasses the three tropical rainforests in the world.
27:13And it also includes the biggest CO2 emitters in the world.
27:19So, they will work together on tempering the negative environmental consequences of economic growth.
27:33So, I think that the G20 is, you could say, the engine of the United Nations.
27:43All right. Well, lots to look forward to in that sense in the coming weeks or in the coming months on that football field.
27:52Prof. Wu, thank you so much for sharing your insights.
27:55That's all for this episode of WUSIS.
27:58I'm Faye Kwan.
27:59Thank you for watching and I'll see you next time.
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