GIS* statement by Prince Michael of Liechtenstein
The G20 finance ministers and central bank governors have already met twice this year to discuss the world economic situation, writes Prince Michael of Liechtenstein.
After the February meeting in Shanghai, they released a cautiously optimistic communique congratulating themselves for “important achievements” in bolstering growth and stability. This was revised to an even more optimistic assessment of global recovery at the April 14-15 meeting in Washington.
The picture looks different if one takes a longer view, especially from the standpoint of business and trade. The G20’s achievements have been mostly in the verbal sphere, with the sole tangible result of imposing more regulations, guidelines and controls. This is the only area where the various countries seem to agree.
More government intervention and the expansion of an already oversized and inefficient regulatory framework, both national and global, can only harm innovation and trade. It fosters protectionism, regardless of the G20’s declarations to the contrary. By stalling the real engines of sustainable long-term growth – free enterprise and free trade – such measures steal prosperity from all parts of society, especially the poor.
Regulatory risk has become a huge obstacle to financing infrastructure projects, which are vital to any improvement in living standards. Irresponsible government interference in markets, usually for populist reasons, has become common in the energy industries and public utilities of many countries, to give just one example.
Perhaps aware of these difficulties, the finance ministers and central bank governors betrayed a certain uneasiness in Shanghai. In the official statement, they published a list of apocalyptic riders that could spoil the results of their good work, and for which they could take no responsibility … Continue reading -> GIS Statement
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