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Spotlight on

Spotlight on Germany Wolfgang Schäuble Federal Minister of Finance, Germany 34 G20 Germany: The Hamburg Summit • July 2017

SPOTLIGHT ON GERMANY Spotlight on Germany The opportunities and risks of globalisation If we are to increase global prosperity, we have to balance the opportunities and risks of globalisation and digitalisation, writes Wolfgang Schäuble Globalisation and digitalisation mean that we are more connected and more dependent upon each other today than at any other time in our history. They offer great opportunity, but – if not managed correctly – can also pose great risk. If we are to increase global prosperity, we have to balance these opportunities and risks. This is the overriding focus of Germany’s G20 presidency in 2017. In the finance track, we are focusing on three key areas: enhancing the resilience of our economies; improving investment conditions, especially in Africa; and shaping digitalisation. The world is still feeling the effects of the last financial crisis, and we cannot exclude the possibility of future turbulence. Global debt has risen to historical highs, which hampers the ability of many countries to respond to any future crisis. It is crucial that we increase the resilience of our economies, and that we build buffers to absorb any future shocks. This is why, at our meeting in Baden-Baden in March this year, we agreed on principles as a basis for national measures to make our economies more resilient. Compact with Africa Shaping globalisation also means improving investment opportunities, especially in Africa. Together with our African partners we want to help make private investment in Africa more attractive by creating a more secure and predictable environment and by reducing the barriers to investment. The aim of our Compact with Africa in the finance track is to boost growth and jobs, promote inclusion and give people economic perspectives in their home countries. Our initiative has received a very positive response, with seven African countries joining so far. It builds on the individual responsibility of the participating African countries to determine the areas in which they intend to reform in order to improve the framework conditions for private investment. Within the framework of the compact, and together with international financial institutions and bilateral partner countries, the compact countries determine how best to implement the priority actions. The third focus is on the opportunities and challenges to the financial sector from digitalisation. Digital innovation improves efficiency, supports growth and enhances global financial inclusion. We can reap huge benefits if we embrace the full potential of digital finance. But there are also risks that need to be addressed. This is why, among other things, we have initiated work on cybersecurity in the financial sector. Financial market regulation We hope to build on the progress so far at the coming summit in Hamburg. Despite some occasional differences in opinion, the G20 process is effective and works well. The G20 has proven successful as a forum for global governance precisely because it allows for differing views, while still keeping the channels of dialogue open. This spirit of cooperation and trust has been clearly underlined in our meetings thus far. We have agreed that what we have decided on financial market regulation must now be implemented. We will proceed with our G20 tax agenda, which to date has been very successful. And we have advanced a number of issues in other areas on the G20 agenda, such as improving the international financial architecture, combating the financing of terrorism, improving the environment for remittances and work on green finance. Global governance Effective global governance is essential if we want to master the challenges facing us in the years to come. It is only by acting together – to build a stable order in an open world with fair and reliable rules – that we can shape globalisation for the better. Germany is strongly committed – during its presidency and beyond – to working together to make the world a fairer, more stable, more prosperous place for all. G20 July 2017G20 Germany: The Hamburg Summit 35

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