BOGOTA, LIMA, SANTIAGO – International economic coordination is as necessary as it is elusive. During the global financial crisis, the G-20 became the primary forum to agree on basic principles in areas such as the fiscal-policy response and the role of the International Monetary Fund. By underscoring the need to avoid trade protectionism and other beggar-thy-neighbor policies, it also put some pressure on governments concerning what not to do. In these respects, the G-20 was clearly a step forward.
Lately, however, as the G-20 has tried to reconcile divergent national economic interests and recovery strategies, it has been far less successful relative to its initial meetings in Washington and London in 2009. Indeed, the G-20’s Seoul summit in early November exposed a deep divide.