I'd like to express my gratitude For all your active participation during our meeting as well as during our very difficult but sometimes it's very fruitful consultation and communication with you all.
I really appreciate for all countries International Organization the G20 members as well as all invitees you are all conveying a very encouraging message to us that is you strongly support Indonesia G20 presidency.
And this is really a very good asset for us to continue maintaining and leading as well as navigating managing this very very challenging year for us as a G20 presidency.
When will the last meet in April, it was very challenging circumstances. And today we are meeting with the challenging circumstances which even more deepen.
So this is something that I do understand that all of you, all of us here, we are all facing a very difficult situation to manage as a finance ministers as well as Central Bank governor.
We are witnessing and alarming increase in food security as the impact of the war in Ukraine and sanctions as well as export restriction which are examples of exacerbating the effect of the covid19 pandemic.
This all has driven food prices to new record level we are likely to see this challenges to be close to the global economy that will persist and we need to address this issue how to avoid the food price that keep in even increasing.
With the increasing food price this could put a million more people into a state of food insecurity. according to the world food program, The number of people facing acute food insecurity has more than doubled since 2019 before Pandemic from 135 million to 276 million.
it is an urgency with which the food crisis should be addressed. the deployment of all available financing mechanism is immediately needed to save lives and strengthen financial and social stability.
Moreover, good macroeconomic policy has also become fundamentally important that have how many country whether the crisis.
Another very important commodity which creating also a huge challenge to all of us, is the energy. The global energy landscape has been radically change or Escape. Energy commodity prices are skyrocketing.
I'm sure all of you as a finance ministers as well as Central Bank Governor has seen this as a threat to our macroeconomic stability as well as a conducive environment for us to maintain recovery.
The World Bank estimates that crude oil prices increased by 350% from April 2020 to April 2022. I think we all remember the beginning of the pandemic in April, that are two days in which all prices actually zero or even slightly negative and now we are facing such a very different extreme situation.
The 350% increase is the largest increase for any two year period Since 1970s. In June, we witness the price of natural gas in Europe increased by 60% in just two weeks. Fuel shortages are unfolding around the world.
And we are seeing this is having a huge political and social implication, in Sri Lanka, Ghana, Peru, Ecuador and elsewhere. This shortages is due to the high gas prices is really really an issue that is threatening our recovery. The world is in the middle of energy crisis.
The war as well as commodity price increase could worsen the global inflation Spike and increase further social instability. we could see further deterioration in living standard, particularly poor and vulnerable households.
Low-income commodity importing countries are likely to be particularly affected, which could lead to further social and political unrest. We have already seen the surge in inflation leading to faster than anticipated Global monetary policy tightening.
In which many of advanced country especially those of you sitting around this table, as well as emerging economies are already increasing, elevating, the interest rate significantly. Given tighten Global monetary policy as well as a company's by liquidity condition emerging countries will need to be increasingly vigilant.
We just going to create Foreigner ability coming from capital outflow and increase in the cost of financing.
So the triple threat of War, surging commodity prices and increased Global inflation, that can also increase and creating a real spill over to debt not only for the low-income countries but also in the middle-income countries are even advanced economy we are starting before Pandemic and then because of panda me as already using our fiscal space that have the implication of increasing deposition.
And now with this triple threat, this is going to be even more a very dire complex to be manage.
Around 60% of low-income countries are already in or near debt distress, while there is developing countries may be unable to meet that payment over the next year.
So this is not only just one, two exceptional cases this is becoming a widespread. This is becoming the issue that Finance Minister and Central Bank Governor together with International Organization multilateral institution need to be concerned.
This significant challenges are on top of the existing unsolved Global problem, as what we are all discussing in the past two year. That is the covid19 pandemic, climate change, and climate mitigation and adaptation, and also the existing debt sustainability many low-income countries. These are all creating a significant hurdle to our shared goal, which is Indonesia presidency was chosen at that time when we continuing this presidency from the Italy, that is we want to see 2022 to recover together recover stronger.
So we the G20 forum come together again that stood with this very critical and complex situation. We are facing another critical time for global economy. That's why the expectation and the hope for this group of country is even higher.
Why we coming together is important we also have to work together to determine how our challenges are to be address
During our presidency I have to express really high appreciation personally to all of you as well as as a country who preside this G20 view on our bilateral consultation and communication, to continue supporting Indonesia presidency and our agenda.
This is really a good hope a strong hope for all of us to be able to continue to take action and also demonstrate the spirit of cooperation collaboration and to share as we are capable of this.Like in 2008-2009 when the global economy was in danger of collapse from Global financial crisis the G20 took action to ensure Global Financial stability.
In 2020 and 2021 when covid-19 swap the world, the G20 again Rose to the challenge deliver action for vulnerable countries facing debt issues ensuring vaccinations would wipe and committing extra-ordinary policy support for our most vulnerable people and small businesses.
It was not easy, this is not an easy time given our diverse membership of the G20 and also the difference and the differences in our position, used as well as experience has on many important issues.
but this differences is also our strength, we represent the most systemically important countries to the global economy, and the action will have a very important effect to the news to All Nations around the world.
So I'm sure you are all aware that the world is watching us closely. There a high expectation for this forum, for this meeting, especially because this is the Finance Minister and Central Bank governor that we are hoping that we can discuss and talk more on the less political but real technical issue which is better for all of us.
We need to act together to demonstrate why G20 deserves its reputation as the premier forum for international cooperation. As we reached the halfway point of our Indonesia G20 presidency, and despite all our different position we have been able to make that tangible progress on some critical issue. And that's I really appreciate it one to expres my appreciation and thank you to all of you who support Indonesia presidency.
Within our G20 presidency we actually continue deliver despite this challenging environment. we see our role to be an honest broker, we aim to build Bridges, Indonesia will continue to relentlessly discussing, reaching out communicating, Consulting, seeking your advice so that we will continue Building Bridges and we're not building walls.
Because we firmly believe that the world is even more and more desperately need more and more bridges and connection not wall and War.
We need to strengthen the spirit of multilateralism, need to also build safety net for our for our future cooperation and also continued strengthening our commitment to the shared Global prosperity. We are acutely aware that the cause of our failure to work together is more than we can afford.
The humanitarian consequences for the world and especially for many low-income countries would be catastrophic. We have taken positive steps toward action. During our meeting in April we agreed that we must adapt our agenda to ensure macroeconomic and financial stability is maintained.
We have committed to text from Collective action and use all available tools to address the current economic and financial challenges we are facing. Since then, we have been significant progress in several areas. we have agreed of our FIF fund, which is for pandemiq prevention preparedness and response, which is hosted at the World Bank and within his initial commitment of 1.1 billion US dollar already secured.
I know many of you in our bilateral meeting stating that you are also expressing this support the FIF and also considering or deciding to contribute. So, I appreciate that decision and we do hope to see more and more of you is going to join this FIF.
We have developed a G20 presidency note on policy setting for exit strategy to support recovery and addressing scarring effect to secure future growth.
A resilient and sustainability trust has been established under the IMF, and thank you Kristalina for your strong leadership, and also passion to assist low-income and debt distress country to build resilience to external shock such as climate change and pandemic, and now even with food and energy crisis.
We have seen the first meeting of the creditors committee to discuss debt relief for Zambia, and the prospect of progress in other countries with similar needs.
We have seen progress in addressing the action identify in the G20 sustainable Finance roadmap, including developing a transition framework, and ways to enhance the accessibility and an affordability of sustainable Finance.
We have discussed a number of case studies of transition activity or initiative to achieve just and affordable transition. Such as energy transition mechanism, involving collaboration among countries, and the private sector and philanthropist.
We have made progress in developing ways to leverage private sector participation in sustainable infrastructure investment and mobilize financing to cities and region. We have made progress on the framework for digital Financial inclusion, especially to increase Financial access for undeserved group especially women, youth, and small medium enterprises.
Despite all those concrete progress and achievements, the G20 has been criticized for failing to deliver action. I think many of you now has been interviewed by CNBC, Bloomberg, and they're asking whether we are going to be able to deliver action.
So it is clear that we must step up our efforts and do more this is despite all those achievement and progress. We need to collectively find ways to contribute to build Bridges between each other and also to recapture the spirit of the G20 to deliver more action.
I really appreciate a lot of support, especially from the previous presidency Italy and the next presidency India, that you both continue to communicate, even I get a lot of advice from the previous presidency that is Saudi.
So thank you so much for both personal as well as institutional support to all of us, which is facing is very complex task. We still need to show the world that we deserve to keep our reputation as the premier economic forum for international Cooperation.
This is should be done through addressing the current crisis that we are facing and working to prevent any further crisis. And the best way to show the world is by sharing with them and update from us and also our discussion and also our action.
I'm sure that your deputies and have brief you on where this process is up to and the format of our update is still being discussed with you all. But I really wanted to take this opportunity to assure you Our intention to get the result that can be communicated clearly to all outside stakeholder.
Given the circumstances we are facing we are trying to find the best solution for the format of the update that we will share. We can promise you that we are not trying to circumvent any processes. We continue communicate reach out with you are indiscriminately, all of you, I really appreciate the work from our deputies, and I also appreciate many of you which is responding positively.
We are flexibly trying to find the best solution for the situation in our consultation with all members as a group we are in this situation together.
There is no "play book", it means that we must be creative in finding solution and it is really that we are inviting you here in Bali.
Bali is an island in which so many artists everything can be touched to become beautiful weather this is ceramide, whether we are talking about bamboo, you can see all of her places that everything is always in a very artistic because of the artist here in Bali.
So, I do hope that many of you by being here or even if you are in distant or virtually participating, you are going to get a little bit sprinkle of this Magic Artist so that we are going to make situation better and better.
It is likely that we are all need to update where we end up in sharing the document from this presidency. While it is true that our ultimate presidency decision on what need to be included in the document, we are all very much want to have all members support to this document, in which we can share what we cover in our discussion what we've already achieve and what is the future of our Focus.
Our to do list over the next two days is not a small task we will focus not only on the emerging issue facing the global economy but also aim to progress on all our agenda to support global economy and also achieving strong sustainable inclusive and balanced growth.
We have set combination of seven important agenda to achieve that goal we will discuss the current Global situation and its risk and how to address the key Global issues this include how we provide greater energy and ensure food security and sustainability.
We will reiterate our commitment to deal with the Covid19 and ensure we are better prepared for the next pandemic. We must continue to assist vulnerable countries manage the debt and to close the financing Gap they are facing.
we need to improve productivity and strengthen Financial stability and regulation while improving Financial inclusion for financial the vulnerable and undeserved groups.
On a global tax agenda, we will discussed how to make progress on more stable and fair International tax architecture.
On climate, we must increase sustainable financing to achieve our climate goals, we also discuss how to revitalize infrastructure investment as well as as many other important areas of action.
So coming together here today, its really a big step forward in working through our differences in position and in Building Bridges toward each other. I hope I can count on you all to find ways that we can maintain the G20 strong track record and working collaboratively collaboratively to deal with this Global crisis.
This means that when our meeting ends tomorrow we will have been able to find a way to reach consensus on what we can do together. With the spirit of cooperation and collaboration how to safeguard the global economy it is not exaggerating to say that millions and millions, if not even billions of people are depending on us.
So we must show the work that the G20 deserves its reputation. Thank you so much, let us continue to our first session.
