The G20 summit shows a world divided in its attitudes toward globalisation

In particular, they are divided over their attitudes toward globalisation. It is globalisation that has significantly increased the degree of interconnection between the world’s economies. And it is this interconnection that drives the need for international discussion and cooperation – via events such as the G20.

But this last year has seen as a loud backlash against globalisation. There was the Brexit vote in the UK and the election of Donald Trump in the US on a protectionist ticket. This is ironic given that they are two of the world’s biggest economies (at least for the time being). Both have been major drivers of globalisation and have benefited enormously from it.

But now both countries are calling the future of globalisation into question. Two sides have emerged in the debate over whether or not globalisation is a good thing and whether or not nation states should be more protective and inward-looking.

On the one hand, some G20 countries emphasise the benefits of ongoing and increased levels of cooperation between countries and regional trading blocs. These countries, such as Germany and Canada, seek to tackle the issues caused by globalisation at the global scale. This is not a homogeneous group, but there is a broad consensus that the high degree of interconnection between the world’s economies is not easily unpicked, nor is it desirable to try to do so.
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G20 Summit 2017: Trump's confusion on key issues stumps Merkel, Trudeau

During a difficult visit to Europe Donald Trump appeared out of sync with traditional allies, struggling to show that unorthodox strategies toward rival powers Russia and China can deliver results.

At one point Canadian Prime Minister Justin Trudeau and German Chancellor Angela Merkel exchanged a knowing glance as the US president veered off on another tangent.

What were to be remarks about women entrepreneurs had become a Trumpian soliloquy on his daughter Ivanka's merits and his paternal failings.

"If she weren't my daughter it would be so much easier for her," Trump said. "It might be the only bad thing going for her."

A few feet away, Merkel and Trudeau's nervy laughs were corporal acknowledgment that Trump's political peers are still unsure how to take the mercurial 71-year-old.

Throughout the meeting there was a sense the president of the United States, leader of the so-called "indispensable nation," has shifted positions, leaving everyone else struggling to correct.

In Warsaw, on the first stop of his four-day trip, Trump sought to reassert his claim to lead the free world.

Like a king riding along the cavalry frontline, he sounded the charge against terrorism and bureaucracy, which he painted as threats to Christian civilisation.

He embraced allies by affirming his commitment to NATO's mutual defense clause, satisfying long-standing demands to be clearer about the alliance.
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G20 summit: Donald Trump says he still wants Mexico to pay for border wall

US President Donald Trump said on Friday that he still wants Mexico to pay for a planned border wall, as he met his Mexican counterpart for the first time as head of state.

Asked at the meeting with Enrique Pena Nieto on the sidelines of the G20 summit in Hamburg, Germany, if he still wanted Mexico to pay for the wall, Trump said: "Absolutely".

Before that, both presidents delivered statements with Trump hailing the "successful day" so far.

"We're negotiating NAFTA (the North American Free Trade Agreement) and some other things with Mexico and we'll see how it all turns out, but I think we've made very good progress," Trump said.

Pena Nieto, through a translator, said that the meeting will help the two countries continue a "flowing dialogue", in particular "for the security of both nations, especially for our borders."

The Mexican president noted that "migration" is an issue that has "occupied" both administrations. He added that it was a "co-responsibility to deal with organised crime issues."

Building a wall between Mexico and the United States to stop illegal immigration -- and Mexico paying for it -- was one of Trump's key campaign pledges in last year's election.

In January, Pena Nieto cancelled a trip to Washington in response to Trump's insistence on the issue, plunging the countries' relations into their biggest crisis in decades.
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The G20's economic leadership deficit

Few have heard of the Baltic Dry Index. It measures the demand for bulk shipping carriers, used for international trade. It usually attracts little attention. But nine years ago this index had the undivided attention of the 20 most powerful leaders in the world.

It was when the global financial system was on a precipice. Stock markets were crashing. Credit markets were freezing. Rolling failures across financial institutions were shattering confidence. Unable to wait for monthly trade data, the Baltic Dry Index showed in real-time what many leaders feared: global trade and commerce were grinding to a halt.

Leaders faced the real prospect of another Great Depression. But they were determined not to make the mistakes of the past. They resisted a return to protectionism. They slashed interest rates and buttressed the International Monetary Fund and development banks. Over the next three years, they implemented US$5 trillion of co-ordinated fiscal stimulus, the largest in history.

That leadership is needed again today. The risks leaders face at the latest G20 meeting in Hamburg, Germany, might not be as serious as those the leaders who met in Washington faced back in 2008. But the risks are present, and leaders are disengaging with the G20’s ever-expanding agenda. They are more likely to use the G20 for cheap political point scoring than for advancing cooperation on critical global challenges.

Australia can play a role in helping the G20 to deliver this leadership.

Economic challenges

Protectionist measures are on the rise. Protectionist rhetoric is rising faster. The World Trade Organisation shows that the stock of trade-restrictive measures is growing, up 8.5% in the 12 months to May 2017 alone.
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