THE EXPANDED MEMBERSHIP OF G20: IMPACT AND ANALYSIS

MOHAMMAD GHAYAZ
2 days ago
7 min read

The G20 or Group of 20, which was founded in 1999, following the Asian financial crisis, as a forum for finance ministers and central bank governors to discuss global economic and financial crisis had upgraded to the level of heads of state/government in the wake of the 2007 global economic and financial crises. It is an intergovernmental organisation comprising 19 sovereign countries plus the European Union (EU), and since 2023, the African Union (AU).

The G20 represents around 85% of global GDP and 75% of global trade, as well as two-thirds of the world’s population, prior to AU joining. African Union’s admission in G20 marked a significant geopolitical shift with implications for global governance, development policy, and economic diplomacy. The 19th G20 summit was held in Rio de Janeiro, Brazil, marked the first time participation of African Union (AU) as a full member. We currently are seeing an increase in global south representation in G20 with four consecutive presidencies under global south nations.

FOUR CONSECUTIVE YEARS OF GLOBAL SOUTH PRESIDENCIES

2024- G20 Rio summit, Hosted by Brazil is the third Global South to host after Indonesia (2022) and India (2023). The next G20 summit will be held in South Africa. Brazil, India and South Africa form the troika of G20. These countries are also part of IBSA (India, Brazil, South Africa) and BRICS groupings. These consecutive presidencies contribute to propelling global south priorities into the global spotlight and coincide with the challenging geopolitical period. Thus, has provided a platform to voice up the challenges faced particularly by the developing nations like poverty, economic instability, financial debt, environmental degradation and political unrest.

South Africa had been the only founding member of G20 from AU. Since 1999 to 2023, there had not been significant initiatives from G20 over African union. India’s G20 presidency in September 2023 decided to grant the African Union (AU) permanent membership made an ideal way for a previously underrepresented region to transform its abundant natural wealth into a sustainable economic agenda. G20’s primary aim is to shape the global economic cooperation and governance. This involves addressing key aspects which aligns with objectives of African Union such as financial stability, socio-economic integration, and broader range of concerns including trade, climate change, sustainable development and, more.

IMPACT OF ADMISSION OF AU TO G20 (2023-2025)

In the current geopolitical order, where major shifts are happening in the global relations and power dynamics, the inclusion of African union has diversified the vision of G20, in the context of increasing profile and the role of a regional organization in the global strata.

Increased Representation

The broadening of the G20 by including the AU increased its global representativeness in shaping global policies. G20’s role has fostered greater coordination among African nations on economic and development issues. AU has become global policy partner on issues like climate change, debt restructuring and sustainable development. It has become one in which all voices are heard and in which all views count. It will foster collaboration between Africa and other developing countries and economic powers.

Economic Development

The G20 witnessed a mixed bag of economic development, with growth rate slowing down in some countries while other countries continue to see a strong growth. According to the OECD Economic Outlook, Interim report 2025 Global GDP Growth is projected to moderate from 3.2% in 2024, to 3.1% in 2025 and 3.0% in 2026, with high trade barriers and policy uncertainty in several G20 economies. Inflation is projected to be higher and headline inflation to fall from 3.8% in 2025 to 3.2% in 2026 in the G20 economies, which indicates that overall rate of price increases in an economy is decreasing, as a result it increases consumer purchasing powers, lowers the borrowing cost and eases the cost of living pressure.

Among African nations AU’s G20 role has fostered greater coordination on economic and development issues. As per the 2025 Macroeconomic Performance and Outlook Report of African Development Bank, growth rates above 5 percent expected in close to half of the continent’s countries in 2025; 12 of world’s 20 fastest growing economies will be African.

Enhancement of Trade

The trade of G20 nations has increased in 2025 from 2023. According to the World Trade Organization (WTO), the merchandise trade which was declined by 1.2% in 2023, has increased to 2.6% in 2024 and is projected to increase by 3.3% in 2025. Though there is a minimal increase but it helps in increased trade which fosters economic growth, resource accessibility, specialization and efficiency, job creation, and increased consumer choices. WTO has reported a rise in trade restrictive measures among G20 nations from 2023. G20 countries implemented 91 new trade restrictive and 141 trade facilitating measures, primarily effecting imports.

AU’s full implementation of African Continental Free Trade Agreement (AfCFTA), world’s largest free trade area bringing together 55 AU nations that aims to establish a single market for Intra-African trade which was established in 2018, aligning with G20 nations has potentially improved trade policies. Several G20 countries have introduced climate related trade measures as part of their efforts to achieve net zero emission goals.

International Financial Architecture and Debt Restructuring

Most of the G20 nations are developing and under developed nations who face critical financial crisis. International financial support to the G20 nations has increased. Since inception, the African Union financial structure has been heavily reliant on funding from international partners. It can impact the long term global financial structure among G20 nations.

G20 is an important forum for discussing multilateral solutions to unsustainable debt. Though there hasn’t been a real solution in debt restructuring, there are G20 initiatives to improve low income countries’ access to affordable capital. During G20 India’s presidency, the global sovereign debt roundtable was established to facilitate discussions on improving debt restructuring under the common framework. Recently, South Africa announced the launch of cost of capital commission during its presidency, which aims to help low income countries to pay less for their borrowing.

Outcomes of G20 Rio Summit and AU

AU was represented at the G20 summit first time after its inclusion. Among the outcomes of the summit, AU played a crucial role in Brazil’s launch of the Global Alliance against Hunger and Poverty, an initiative that aligns with the AU’s focus on improving food security and agricultural investments. With other G20 leaders, the AU endorsed Principles for just and inclusive energy transition, complementing Africa’s Green Industrialization initiative for green energy projects. Furthermore, the AU reaffirmed its support for the G20 compact with Africa and actively participated in the G20 trade and investment working group.

Other Initiatives

There has been an uptick in commitments from G20 nations towards infrastructure development and digital connectivity. China has launched the ‘Open Source International Cooperation Initiative’ with Brazil, South Africa and AU to promote science and technology in developing countries. China’s initiatives also focus on anti corruption, asset recovery and zero tariff exports to friendly developing nations.

RELAVENCE OF G20 SINCE 2023

Following the inclusion of African Union, relevance of G20 has significantly increased in terms of representation, collaboration, reformation of African countries and the global south.

After the AU’s admission, G20 now represents 80% of the global population, having youthful population and immense human resource. Africa’s demographic advantage transform the G20 from a group of powerful economies into more future oriented forum which would guarantee an innovation led and industrialised forum. G20 provides a platform for Africa to advocate its interest and participate in shaping the global trade policies by including the African Continental Free Trade Area (AfCFTA).

G20 plays a very critical role in the sphere of development with wider representation, primarily as a forum for elevating the voice of global south, and by providing international financial support to the developing nations. It has become a good opportunity to show the potential for Africa to share and advance its transformative roadmap captured in its Agenda 2063.

There is a greater relevance amid strategic incorporation of AU to G20, which underscores its advocacy for developing nations like India, Brazil, Germany, South Africa and aligns with its bid for permanent membership in United Nations Security Council (UNSC), holding 55 vote representations.

Overall we can say that the significance of G20 has remarkably increased with AU’s inclusion. AU can now influence global discussions on climate change, digital transformation, food security, debt relief. Its presence may help rebalance global power dynamics and ensure that policies reflect diverse perspectives, especially Global South. The G20 is now reaffirming its commitment to creating a more multi polar world where no single bloc is dominant.

G20 2025 SUMMIT

Upcoming G20 summit which will be held in South Africa will be marked as a historic event in terms of Africa’s representation. It will be convened for the first time on African soil. This highlights the growing importance of the continent in the global economic, political and environmental discussions. G20-2025 has set a powerful and necessary theme, “Justice for Africans and People of African Descent through Reparations”. The President of South Africa, Cyril Ramaphosa, at the G20 foreign minister’s meeting has identified four priorities for its G20 presidency. First is to take action to strengthen disaster resilience and response. Second is to ensure debt sustainability for low income countries. Third is to mobilise funds for a just energy transition. Last is to harness critical minerals for inclusive growth and sustainability.

CONCLUSION

AU’s inclusion in G20 is a historic step towards global inclusivity and recognition of Africa’s growing geopolitical and economic importance. It has brought African priorities into global discourse, boosted the G20’s legitimacy, and deepened the relevance of south-south cooperation. AU’s inclusion in 2023 has a meaningful impact on G20 nations. It could also limit the G20’s ability to formulate fully responsive policies which concern Africa’s effectiveness in implementing them because of their backwardness.

Major problems faced by the AU like poverty, unemployment, financial crisis, regional conflicts, climate change are now inclusive concerns of G20. In short, it’s long term effectiveness will hinge on implementation and institutional reforms. We are five years away from 2030, the deadline for achieving the Sustainable Development Goals. AU, which are far behind in achieving these goals could slow down the G20’s development pace. Present G20’s presidency of South Africa will be challenging for AU to align with top countries targets, but the role of AU will be significant in making achievable and remarkable initiatives. Being the face of global south, G20’s initiatives should align socio-political and economic inclusiveness for addressing the global challenges.