Global Solutions Summit highlights need for fundamental system change in post-Covid world

The summit’s first day featured calls to strengthen health preparedness, guarantee human rights in the digital realm, and overhaul economic modelling, accounting and trade governance

Berlin, May, 27th 2021 – The Global Solutions Summit kicked off on Thursday as a “rallying cry” for a Great Realignment, with top politicians, academics and business chiefs calling for fundamental changes in health, technology and finance that have been made even more urgent by the coronavirus pandemic.

“This year’s Global Solutions Summit, a stepping stone to the T20 summit and the G20 summit thereafter, is meant to be a rallying cry for this Great Realignment which occurs in a historical watershed created by the global Covid pandemic,” Global Solutions Initiative President Dennis Snower said in opening the event. “The Great Realignment aims for an economic prosperity that is compatible with environmental sustainability, social solidarity and personal agency.”

The Covid crisis has resulted in an unprecedented intensity of scientific cooperation and interaction between academics and politics, according to a panel on pandemic preparedness. But it has also exposed fundamental weaknesses in the global order and resulted in vaccine nationalism.

The world was not prepared for a health crisis of this magnitude, Germany’s Health Minister Jens Spahn said.

“Strengthening health preparedness is not an expenditure, but it is an investment for the future,” he said, as he lamented the lack of political will to implement the lessons derived from the crisis.

German Finance Minister Olaf Scholz expressed optimism that the global economy could soon rebound to pre-crisis levels, while highlighting the importance of global cooperation.

“Looking at the situation of the global South is also a question which is important for the economic recovery of the world and so I think we need solidarity, and it makes sense also in economic terms,” he said, adding that the poorest countries should get help in vaccinating their populations.

The pandemic has made it “very clear” how much humankind depends on intact natural environment, German Environment Minister Svenja Schulze said.

“Ultimately, pandemics are caused by the same things that cause biodiversity loss and fuel climate change: increased and destructive human encroachment on natural ecosystems,” she said. “Our task now is make life with the pandemic and amid climate change more resilient, more just and safer.”

Central banks, which were traditionally reluctant to deal with climate change, have become much more focused on the issue in the past few years, according to Isabel Schnabel, executive board member of the European Central Bank (ECB). A new conception of economic modelling is needed in their fight against global heating, she said.

“We have to ask ourselves whether we are doing what we could and should do with respect to climate change, so this is not just about asset purchases, or not just about lending operations – we have to look at everything and this actually starts with fundamental thinking about economic models,” Schnabel said, adding that the current models are “quite deficient” in measuring transition risk.

The current system of corporate reporting also needs to be overhauled if the world is to attain climate goals, as a business wanting to implement a net zero strategy today is likely to be dissuaded by concerns over the company’s share price.

“We have a situation where doing the right thing, investing heavily in net zero transition is penalized … and on the other hand doing nothing or doing the minimum possible is rewarded,” said Robert McGarvey, co-founder of the think tank Rethinking Capital.

Instead, accounting should measure intangible assets such as how companies contribute to social wellbeing and environmental sustainability, according to the panelists.

Change is also needed in global trade governance, which is why the European Union has proposed reforms to the World Trade Organization, European Commission Executive Vice-President Valdis Dombrovskis said in a keynote address.

While the WTO remains the right body to ensure rules-based international trade, “it’s clear that we need to improve its efficiency” so it again starts delivering on its core functions of negotiation, monitoring and deliberation, dispute settlement, he said.

In the digital realm, Vera Jourová, vice president of the European Commission for values and transparency, noted that quicker-than-expected digitization poses a challenge to protecting values and human rights over the next decade.

Europe, seen as a leader in regulating data protection, must react to emerging money-driven digital technologies with meaningful rules. “Our European way is mainly to guarantee that the values and human rights will be present,” Jourová said.

German Chancellor Angela Merkel and Mario Draghi, Italian Prime Minister and President of the G20, are set to open the second conference day on Friday, which will also feature UN Secretary-General António Guterres.

The two-day Global Solutions Summit is convening more than 150 decision-makers from politics, academia, international organizations and business to debate the biggest problems faced by the G20 network of major economies. Now in its fifth year, the event generates policy responses ahead of the G20 forum, taking place in Rome this October.

Looking ahead to Indonesia’s G20 presidency next year, the country’s Finance Minister Sri Mulyani Indrawati said its main objectives are to strengthen countries’ commitment to work together to improve, and to ensure that all economies can recover together and invest in a better future.

The annual Global Solutions Summit is mainly online for a second year due to the pandemic, with some sessions taking place in-person in Berlin. Organizers expect more than 6,000 participants from over 160 countries to tune into the live-streamed sessions.

By Sophie Wingate, on behalf of the Global Solutions Initiative

 

Notes to the Editors

The Global Solutions Summit 2021 will take a hybrid virtual and in-person format due to the Corona pandemic this year. In the studio, which will be set up in-house at the Berlin European School of Management Technology (ESMT), participants from all over the world will be connected with moderators and speakers who will attend in person from the studio. A digital platform will allow all participants not only to follow the presentations and discussions, but also to exchange ideas with other attendees. “The appeal of the physical Summit has always been the ability to meet face-to-face with many like-minded people. It is exceedingly important to us that much of this can also take place in the digital space,” stresses Dennis J. Snower.

The continuously updated program, an overview of the most interesting speakers, and a registration form are available here: https://www.global-solutions-initiative.org/events/summit/summit-2021/

 

About the Global Solutions Summit

The Global Solutions Summit is held annually by the Global Solutions Initiative, a global think tank network which contributes to greater continuity and impact within G20 policy arenas, by bringing together G20 leaders and leading scientists to find solutions to the world’s great challenges. The Global Solutions Initiative is chaired by Professor Dennis J. Snower, President emeritus of the Kiel Institute for the World Economy. The Global Solutions Summit is a T20-associated event. The T20 is one of the official G20 engagement groups and comprises the most important think tanks of the G20 countries.

 

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About the Global Solutions Initiative
The Global Solutions Initiative is a global collaborative enterprise that proposes policy responses to major global problems, addressed by the G20, the G7 and other global governance fora. The policy recommendations and strategic visions are generated through a disciplined research program by leading research organizations, elaborated in policy dialogues between researchers, policymakers, business leaders and civil society representatives.

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