*** © UNCTAD Photo | UN Trade and Development Secretary-General Rebeca Grynspan addresses the G20 Finance Ministers and Central Bank Governors Meeting held on 26 and 27 February in Cape Town, South Africa.***
By Staff Reporter
G20 economic cooperation is more vital than ever in a world of low growth, soaring debt, high uncertainty, weak trade and low trust.
Comprising the world’s major economies, the G20 represents 85% of world GDP, 75% of international trade and two thirds of the global population.
“The greatest risk to growth is our failure to imagine a common future,” UN Trade and Development (UNCTAD) Secretary-General Rebeca Grynspan tells G20 finance ministers and central bank governors meeting in Cape Town, South Africa on 26 and 27 February.
Atop their meeting agenda is the 4th International Conference on Financing for Development that the United Nations will convene in July 2025.
Making financing and development mutually reinforcing
At best, financing and development can benefit each other, creating a virtuous cycle that builds productive capacity, creates jobs and spurs growth.
But this cycle is currently broken amid global economic uncertainties, Ms Grynspan warns in her remarks.
According to UN Trade and Development analysis, global foreign direct investment posted a fall of 8% in 2024, while investments in sectors crucial to sustainable development dipped by 11%.
Reforming global financial systems
In a renewed push for international financial architecture reforms, Secretary-General Grynspan calls for supporting multilateral development banks to multiply current lending, crowding in private investment and giving them access to special drawing rights (SDRs).
This will entail a structural and multilateral solution to debt restructuring, meanwhile placing the role of the International Monetary Fund and SDRs at the centre of the global financial safety net.
Equally important is to reform the G20 common framework on debt restructuring and relief, allowing middle-income countries to provide debt standstills and ensure private sector participation.
“Our international financial architecture needs to adapt to raising challenges. But in doing so we must avoid fragmentation, embrace renovation and infuse a sense of urgency of action,” Ms Grynspan says.
Shoring up sustainable finance
Turning to sustainable finance – where investment decisions incorporate environmental, social and governance considerations – Ms Grynspan calls for updating international investment agreements to help countries mobilize their policy tools for climate action.
The UN Trade and Development chief also reiterates the need to tackle greenwashing, where misleading sustainability claims are increasingly affecting investor demand and hampering inflows into the sustainable fund market.
“The question now isn’t whether we can afford sustainable investment, but whether we can afford its absence,” Ms Grynspan concludes.
Global leadership is changing – so is trade
*** © UNCTAD Photo | UN Trade and Development Secretary-General Rebeca Grynspan (right) pictured with UN Deputy Secretary-General Amina J. Mohammed (middle) and African Union Commissioner for Economic Development, Trade, Tourism, Industry and Mining, Albert M. Muchanga (left), at the Group of 20 (G20) Foreign Ministers Meeting on 20 February in Johannesburg, South Africa.***
Speaking at the G20 Foreign Ministers Meeting session on geopolitics in South Africa on 20 February, UN Tade and Development (UNCTAD) Secretary-General Rebeca Grynspan emphasized that the past four years have demonstrated the potential of multipolarity to strengthen, rather than weaken, multilateralism.
“This year marks the final chapter in a remarkable four-year-cycle – the first time the G20 presidency has resided continuously in the Global South. From Indonesia to India to Brazil, and now to South Africa, we have witnessed the changing face of global leadership and had a glimpse of the future,” Grynspan said.
“These last four years have proven that the right choice is to have multipolarity with multilateralism.”
Opportunities in a shifting economic landscape
While economic uncertainty remains, new trade dynamics are emerging that could foster a more inclusive and sustainable growth. Post-pandemic recoveries have been uneven, with some economies facing stagnation, investment uncertainty, and debt distress. However, South-South trade and regional integration are gaining momentum, creating new avenues for economic resilience.
Initiatives such as the African Continental Free Trade Area (AcFTA), ASEAN, and the EU-Mercosur Agreement showcase how regional and interregional cooperation can complement global engagement and drive new sources of growth.
For these opportunities to materialize, investment must remain a priority. UNCTAD warns that a chain reaction of trade disruptions, inflation and exchange rate volatility – combined with higher borrowing costs – could force more countries to divert resources away from long-term development to service their debt.
Towards a more balanced and inclusive trade system
UN Trade and Development is calling for trade and financial reforms that grant developing countries the policy space needed for industrialization, diversification and long-term investment.
This includes modernizing trade agreements to foster sustainable investment and ensuring that global trade rules work for all economies, not just the largest players.
“We believe in a world with better rules, not a world without them. Maybe now is the opportunity to achieve this as we face the many challenges ahead,” Grynspan stated.
With South-South economic cooperation on the rise, the global economy is at a turning point. By strengthening regional value chains and embracing inclusive policies, countries can turn uncertainty into opportunity – ensuring that economic transformation benefits all.