Can Canada and its G20 allies afford not to listen?

WASHINGTON — Senior government officials from Canada, the US and five European allies walked out of a G20 economic meeting in Washington on Wednesday when the Russian finance minister began to address the meeting virtually.

An official familiar with what happened in the meetings said that the G20 plenary session had been addressed near its start by Ukrainian Finance Minister Sergii Marchenko, who was invited to the meeting to address the situation resulting from Russia’s invasion of Ukraine.

In person at the meeting, the official said, Deputy Prime Minister Chrystia Freeland spoke with Russian “technocrats” who were in attendance before their finance minister was to speak virtually. Paraphrasing, the official said Freeland told them, “you may be technocrats, but you are now complicit in war crimes. It is never too late to do the right thing. You should either convince (Russian President Vladimir) Putin to end the war or leave your positions.”

When Russian Finance Minister Anton Siluanov attempted to address the meeting, Freeland and Bank of Canada governor Tiff Macklem walked out, as did US Treasury Secretary Janet Yellen and Federal Reserve chair Jerome Powell, alongside representatives of the European Union, France, England, Germany, the Netherlands and Ukraine’s Marchenko.

Shortly afterward, Freeland’s press secretary explained the walkout in a statement to the Star. “This week’s meetings in Washington are about supporting the world economy — and Russia’s illegal invasion of Ukraine is a serious threat to the global economy, raising the price of food and fuel and hitting the most vulnerable among us the hardest. Russia should not be included in these meetings,” Adrienne Vaupshas said.

Russia’s continued participation in the G20 has been controversial since its invasion of Ukraine began in late February. Last month, US President Joe Biden said Russia should be removed from the G20 — comments echoed shortly afterward by Prime Minister Justin Trudeau.

Russia was kicked out of what used to be the G8 alliance over its invasion of Ukraine’s Crimean peninsula. But the G20 is a larger and more diverse group of nations — literally, the 20 largest economies in the world — and there is no mechanism save consensus to kick any country out. Large and important members like China and India have not taken as strong a stand against Russia’s invasion of Ukraine as Western countries have, and Indonesia, which holds the rotating leadership of the group this year, has insisted so far on inviting Russia to the meetings.

Wednesday marked the first meeting of G20 officials since Russia’s invasion of Ukraine began, but the tensions were already present at the last meeting There, Reutersreported, Freeland warned that if Russia invaded Ukraine, “The economic sanctions on Russia will be swift, they will be co-ordinated, they will be crushing.” To that, the Russian representative was reported to have responded that talk of an imminent invasion was “fake news.”

With the walkout on Wednesday, urgent issues on the G20 agenda could be left in limbo. Food security, energy prices and security, inflation, and debt restructuring for poorer countries after COVID-19 are matters that Yellen told the US Congress this month were urgent even as she was threatening to boycott the meetings over Russia’s involvement, warning of “spillovers” that threatened the global economy.

Among the spillover effects is a challenge to the viability of large multilateral institutions in a world reshaped by war. Since Russia’s invasion of Ukraine, organizations such as NATO, the G7 and the EU — smaller institutions of allied democratic large economies — have been functioning in closer co-ordination than they have in years. But the efficacy of larger organizations is a different story: the United Nations, where Russia holds a veto over Security Council resolutions, for example, has sometimes seemed like a grim parody in its inability to address Russia’s actions.

The G20, of which Russia is a member and in which the participation of non-Western-aligned countries like China, Brazil and India are essential, is an example of an institution that becomes more difficult to navigate during this crisis.

“The need for a G20 meeting is pressing and compelling, but it’s difficult to see in these circumstances if a real meeting can be held at all,” says Matthew Goodman, senior vice-president for economics at the Center for Strategic and International Studies. Even if some meetings can take place, he said, “it’s hard to see how we’re going to get a lot of concrete outcomes, and that’s a real loss for global welfare, generally, broadly defined.”

There are not a lot of other global institutions, Goodman says, as well positioned to confront the economic challenges the world is facing. And so as difficult as it may be, Goodman says, after this initial walkout to make a statement of principle in the face of an ongoing invasion, the leaders of G20 countries may need to find “some creative solutions” to address the agenda soon.

The challenge at the moment is that Russia’s invasion has created pressing problems that require the attention of global institutions, but Russia’s involvement in those institutions is an obstacle to tackling those problems.

Yellen recently told Atlantic Council that the world cannot afford to wait out Russia’s invasion to address its effects. The world agreed meetings to set up the postwar financial order while the Second World War raged on, she said, and “as then, we ought not to wait for a new normal. We should begin to shape a better future today.”

But in the way of working towards that goal Wednesday was the presence of a Russian official (virtually) at the table. Yellen, Freeland and other allies showed they didn’t think the best way to shape a better future involved sitting at a G20 meeting with a participant they considered an active war criminal. In the days and weeks ahead, they’ll have to see if they can find another way.

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