Institute of Business Administration

University of Dhaka

Functions, Challenges & Constraints of

G20 , G8 & NAFTA

Course:
International Marketing
Course Code:
(M405)

Prepared for:
Mahmud Zaman
Guest Faculty
Institute of Business Administration
University of Dhaka

Prepared by:
Fuad Ahmed
BBA 23rd
Roll no: ZR-04

Submission Date:
18 February 2018
G20
Function
The G20 focuses on a broad agenda of issues of global importance. Although issues
pertaining to the global economy dominate the agenda, additional items have been given
greater focus in recent years. Traditional topics of debate centre around the global
economy, financial markets, tax and fiscal policy, trade, agriculture, jobs, energy, and the
fight against corruption. Other elements of recent agendas include the advancement of
women in the job market, the 2030 Agenda for Sustainable Development, climate change,
global health, anti-terrorism and inclusive entrepreneurship, amongst others

Challenges

First, strengthening implementation. The ambitious commitments of the G20 are

impressive, yet there is often an implementation gap. There are two areas in particular
sector where G20 countries “talk the talk” but now need to ‘‘walk the walk’’G20 countries
“talk the talk” but now need to ‘‘walk the walk’’.

Several factors are compounding these problems. Low commodity prices are having a
negative impact on global growth. Financial market volatility is making companies and
consumers cautious about spending, and the risk of further nancial disruption is increasing.
Geopolitical pressures are rising, and political populism is visible in many countries.

The G20 has come up short on the structural reforms needed to promote competition,
strengthen skills, facilitate labour mobility, and improve financial market robustness
to boost productivity and promote inclusive growth. Despite a 2014 G20 Brisbane
commitment ─ monitored by the OECD and IMF ─ to raise global GDP by an additional 2% by
2018, measures implemented so far will only add around 1%. Countries must do better to
have any hope of escaping the low-growth trap!

A more effective and fully nanced global safety net is needed to reduce risks globally; work
needs to start on a longer-term mechanism for allowing countries in crisis to restructure
their debts. Financial risks, both country-speci c and cross-border, also need to be
addressed.

Constraints

Despite repeated commitments by G20 leaders to resist protectionism, trade-distorting

measures remain. Of the 1,583 trade-restrictive measures recorded for G20 economies
since 2008, only 387 have been removed. 1,196 restrictive measures are still in place!

In response, policies need to be more supportive of growth. G20 ministers and central bank
 governors have pledged to use all tools of economic policy – structural reforms, monetary
expansion and stimulus – to boost growth. But so far there has been little action.

G8
Function

FOSTER CONSENSUS ON GLOBAL ISSUES :

ECONOMIC GRORTH
CRISIS MANAGEMENT
GLOBAL SECURITY
ENERGY
TERRORISM

Challenges

OFTEN UNDERAPRECIATED AS AN INTERNATIONAL SECURITY LYNCHPIN.

RUSSIA ANNEXED OVER CRIMEA INCIDENT.

Constraints

EXCLUDES EMERGING POWERS FROM IMPORTANT TALKS CONCERNING THE GLOBAL

ECONOMY AND INTERNATIONAL SECURITY.

LESS LEVERAGE ON EACH OTHER BECAUSE OF INFORMAL GROUPING

NAFTA

Functions

The major functions of NAFTA are:

 Eliminate trade barriers in various service sectors belonging to its member nations.
 Reduce high Mexican tariffs and help to promote agricultural exports.
 Assist firms spanning the three nations to bid on government contracts.
 Assure fair market value to investors by reducing risk and offering the same legal
rights that are enjoyed by local investors.
 Help investors to claim against a government by offering legal help

Challenges
The challenges for NAFTA are:
 Resolve current trade disputes pertaining to sugar, softwood lumber and trucking, just to
mention a few.

 Address the issue of 10 million illegal Mexican immigrants in the US.

 Include Mexico in important provisions relating to investments.

 Enable funding and adequate mandates for key institutions like NADBank (North American
Development Bank).

 Resolve the trade deficit of the US with Canada and Mexico, which grew from $9.1 billion in
1993 to $138.5 billion in 2007.

Constraints

The outcome of renegotiations depends, theoretically, on the points of intersection

of the three national agendas and the win sets resulting from the areas where the
parties would be willing to make concessions.

The crucial factors running through the negotiations—and what narrows the path to
a successful renegotiation—are the promises Trump made to his electoral base.

Negotiations may yet fail. NAFTA may still collapse. But the likeliest outcome is that,
by mid-2018,all three parties will walk away with an agreement that allows them to
claim a political victory.