G-20 Brisbane Showing Cracks in Infrastructure Agenda

As we approach the G-20 Leaders Summit in Brisbane, it is worth giving credit to Australia for its robust presidency, and particularly the attention paid to the G-20’s development agenda. Sandwiched between the Russian and Turkish presidencies—countries considerably more controversial these days in the West—Australia faced the difficult task of generating sufficient goodwill among the membership within a year to make some progress on a sprawling work plan.

This is no easy task for any G-20 presidency. The development working group (DWG) is situated among nine other priority areas (from anticorruption to trade), each with its own working group, task force, or work stream by some other label. And all of this is carried out without a permanent secretariat.

So what are the achievements of and prospects for the G-20’s development agenda?

I’ll start with the good news. Four years in, the idea that the G-20 should have a development agenda is firmly entrenched. And the agenda itself is noticeably different from the historical G-7 agenda, which was almost always marked by an aid pledging exercise. Having agreed at the outset to steer clear of major aid commitments, the G-20 has sought to embody the idea that development policy should not be equated with foreign aid alone. Instead, on issues like agricultural productivity, financial inclusion, and infrastructure, the G-20 has sought to be a knowledge platform as well as a sort of policy steering committee for bilateral and multilateral actors, consistent with the G-20’s other work.

But the DWG’s infrastructure work in particular is beginning to show cracks.  Since the working group’s inception four years ago in Seoul, infrastructure has been at the top of its agenda. That prioritization alone speaks well of the group’s responsiveness to the developing world’s own priorities, where infrastructure has long been recognized, both literally and figuratively, as a major bottleneck to growth and development.

Yet, what are we to make of the G-20’s more recent, but separate, “investment and infrastructure” agenda?  No clear conceptual lines have been drawn between the two, but they proceed within distinct working groups of different actors, one from the sherpas’ channel (DWG) and one from the finance ministers’ channel (“investment and infrastructure”).

If G-20 finance ministers, from a mix of developed and developing economies, see value in a shared infrastructure agenda for their own countries, what’s the value of a separate agenda for other developing countries? Arguably, the DWG has a more distinct focus on low-income countries. And, granted, Brazil’s infrastructure needs and challenges may look more like those of the United States than they do of Malawi. Still, are these separate work streams for infrastructure achieving a larger development aim, or are they reinforcing the foreign-aid view of development as something that is done to other countries?

I’m even more discouraged by what promises to be one of the major infrastructure deliverables for the leaders’ summit: a World Bank–hosted Global Infrastructure Facility (GIF). Frankly, having read the World Bank’s note to the G-20, I still don’t know what to make of the new facility, except that the ratio of new bureaucracy created to new money mobilized seems extremely high.

Even more damning given the initiative’s emphasis on partnerships are the missing actors among the partners. The GIF highlights the role of “MDBs and RDBs,” and yet neither the Inter-American Development Bank (IDB) nor the African Development Bank (AfDB) is present among the partners. This absence of the IDB and AfDB has the appearance of infighting among the MDBs—certainly nothing new, but something the G-20 itself ought to be able to overcome in its role as “shadow” governance of the MDB system.  

In the end, a key test for the GIF is the degree to which it will matter for G-20 countries’ own infrastructure agendas. Will the GIF offer something new and better than traditional MDB engagement in countries like India, Brazil, or China? Or will this end up as another showpiece initiative foisted onto low-income countries alone? Apparently, the IDB and AfDB had their doubts. I have some too.