Page last updated at 16:36 GMT, Thursday, 2 April 2009 17:36 UK

Did it deliver for the world's poorest?

By David Loyn
International development correspondent, BBC News, G20 summit

In a letter to the Financial Times ahead of the G20 summit, a group of prominent economists, including the Nobel Prize winner Joseph Stiglitz, said that the main test of the summit would be how it helped the poorest.

A woman does her washing in a Kenya slum
It is hoped the higher-than-expected pledges will help the poorest countries

So how did it do?

Gordon Brown had been pushing for substantial assistance for the developing world, and said that in the end that was the focus of discussion, not the anticipated argument between Europe and the United States over banking regulation and the scale of fiscal stimulus needed.

What he achieved was a far more substantial package for the developing world than had been expected beforehand.

Of the $250 billion (£170bn) in 'Special Drawing Rights' - essentially short-term debt - $19 billion of that is earmarked for the poorest, least developing countries.

The sale of International Monetary Fund (IMF) gold will also make credit available many times in excess of the capital sum itself, once it goes through the system.

Trade boost

The measure that could make the most difference in the short term for the poorest countries is availability of $250bn of trade credit.

That figure too is larger than was anticipated before the summit. It will enable goods currently rotting on the quayside in Africa to move again.

That was the change that the poorest countries were pushing most.

A Nairobi market
Developing countries have been hit by a decline in tourism

Ahead of the conference the Ethiopian Prime Minister Meles Zenawi made a hard-headed case for assistance saying that it would be cheaper to pay countries to get out of their economic problems now than have to fund the consequences of conflict later.

He warned that some countries "could go under and that would mean total chaos and violence".

Developing countries that were already vulnerable after the spike in food prices last year have suffered from a downturn in tourism, remittances from workers living abroad, and the collapse of commodity prices.

'New world order'

The presence of Ethiopia, representing Africa, and Thailand, representing South East Asia, at the top table alongside more sizeable emerging economies like India, China and Brazil is why this summit changes the way the world does business.

Unlike the G8, the wider tent of the G20 ensured that bigger issues were discussed.

Gordon Brown said "a new world order is emerging".

He said that the key financial institutions, the IMF and the World Bank, will be led in future on merit, rather than the top jobs being held always by Europe and the US.

But the bold words in this summit may not prevent the creeping protectionism that the developing world fears will lock them out of trading their way out of the crisis.

The summit agreed that the Doha round of world trade talks should begin again. It aims to liberate trade rules, but has been stalled since last August.



Print Sponsor


RELATED INTERNET LINKS
The BBC is not responsible for the content of external internet sites


FEATURES, VIEWS, ANALYSIS
Has China's housing bubble burst?
How the world's oldest clove tree defied an empire
Why Royal Ballet principal Sergei Polunin quit

BBC navigation

BBC © 2013 The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.

Americas Africa Europe Middle East South Asia Asia Pacific