Brazil’s G20 Summit: Can It Break the Vicious Cycle of Inequality, Debt, and Sustainability in the Global South

By Dr Venkatachalam Anbumozhi, Senior Research Fellow for Innovation, and Ana Célia Castro, Professor, Federal University of Rio de Janeiro: The upcoming G20 Summit in Rio de Janeiro is set to bring a divided world together, sounding a call for meaningful reforms to benefit the Global South by reducing inequalities, promoting inclusion through sovereign debt relief, and enhancing sustainable development. With both opportunities to establish an equitable global order and risks of derailment due to North-South divisions, the summit could be pivotal.

Scheduled for 18-19 November, Brazil's Rio summit will host 19 member countries, the African Union, and the European Union, marking the culmination of a year's work across ministerial meetings, senior officials' working groups, and engagement groups. Under the theme 'Building a Just World and a Sustainable Planet,' Brazil's G20 presidency is a credible voice advocating for bridging the North-South divide. Key issues, such as hunger eradication, inequality reduction, climate action, and governance reforms, will be central, while Brazil works to ensure continuity by championing Sustainable Development Goals (SDGs), climate justice, and multilateralism - priorities shared by recent chairs Indonesia and India and the upcoming South African presidency in 2025. This succession of four Global South nations as G20 chairs provides an unprecedented opportunity to address the cycle of inequality, debt, and sustainability.

Global South G20 Presidencies: Achievements of Indonesia and India

The G20 was founded in 1999 as a response to the Asian Financial Crisis, aiming to include emerging economies in global economic dialogue and foster policy coordination. Today, the G20 represents two-thirds of the global population, 80% of the world's GDP, and 75% of global trade. Since inception, it has focused on stabilising the global economy through collaborative solutions, as seen in the 2009 summit's US$4 trillion green stimulus package and bank reforms and the 2016 Paris Climate Agreement's implementation facilitated by the G20.

Recent G20 chairs held by the Global South have continued this legacy with progressive action: Indonesia in 2022 backed a global health architecture reform, establishing a pandemic fund and Just Energy Transition Mechanisms, and implemented rules for global e-business taxation. India's 2023 Presidency, the second one held by the Global South prioritised digital public infrastructure, a framework for global decarbonisation, and financial reforms. These steps highlight the Global South's impact on G20 priorities and its advocacy for inclusive solutions to global challenges.

Brazil's G20 Priorities: Addressing Inequality, Debt, and Sustainability

Brazil's G20 presidency comes at a critical moment. The global economy is slowing, with over 70 countries in the Global South burdened by debt, and conflicts and climate change exacerbate food and energy insecurities. Brazil is positioning itself as a voice for the Global South, bridging divides with the North, and using the G20 as an inclusive platform to champion pressing issues.

In 2024, Brazil hosted finance and foreign ministers' meetings to incorporate developing countries' perspectives and invited 19 countries from Africa, Asia, and Latin America to the G20 ministerial discussions. Key topics included climate financing, access to green technology, food security, women-led development, and reforms to multilateral development banks to triple sustainable lending for poorer nations. Brazil's presidency also synthesised input from 13 engagement groups, such as C20 (civil society), T20 (think tanks), and Y20 (youth), to ensure diverse viewpoints and constructive policy discussions.

A notable highlight of Brazil's presidency is the Social Summit, held just before the G20 Leaders' Summit. This event fostered dialogue between governmental and non-governmental G20 participants, facilitating the exchange of policies centred on social, economic, and environmental justice and addressing inequalities. Additionally, Brazil's launch of the Global Alliance Against Hunger and discussions on the Bioeconomy underscored its commitment to equitable solutions in resilience and responsible energy transition.

Debt relief is essential for breaking the cycle of inequality. Brazil has advocated for a comprehensive debt relief framework that includes all creditor classes, including previously excluded multilateral banks. By prioritising debt relief, countries can allocate resources to health, education, and poverty reduction, which benefits marginalised groups, especially women, who bear the brunt of austerity measures.

Challenges to the Global South's Aspirations at the Rio Summit

The Rio summit is expected to adopt a G20 Leaders' Declaration, a collective commitment to addressing the poly-crisis and agreed priority actions. As an experienced statesman, President Luiz Lula da Silva will need to carefully manage partnerships within the G20 to gain consensus on a global action agenda that aligns with Brazil's commitment to mediate between the Global South and North.

The G20 was created to promote collaboration and dialogue on global economic issues, offering an alternative to the Washington Consensus approach to crises. With the Rio summit, the G20 faces a significant test in finding collaborative solutions that benefit all members taking into account the aspirations of the Global South while tackling complex challenges of inequality, debt relief, and sustainable development. Although reaching consensus amongst diverse participants is challenging, it is essential for forging genuine global cooperation. A successful Brazilian G20 presidency would set the stage for South Africa's turn in 2025, further empowering the Global South in the quest to address economic, geopolitical, and climate-related uncertainties.

Disclaimer: The views expressed are purely those of the authors and may not in any circumstances be regarded as stating an official position of the Economic Research Institute for ASEAN and East Asia.