Gayatri and Leika Suroyo

JAKARTA/TOKYO – The crisis in Ukraine has overshadowed a meeting of top finance executives from 20 countries that began on Thursday. Indonesia’s President warned “now is not a time” to increase risks for a fragile global recovery.

Russia’s military presence near Ukraine’s borders has caused one of the worst East-West crises for decades. It has also jolted the financial markets, adding to the challenges facing a global economy still recovering from the COVID-19 epidemic.

The G20 Finance Leaders’ Meeting will discuss geopolitical risk and economic fallout of the pandemic. Other topics include rising global inflation, tighter monetary policies in certain regions and increasing global inflation.

Joko Widodo of Indonesia was the president and he urged G20 members to collaborate to revive an economy that has been “still shaken” by the pandemic.

He said, “In an environment like now, we are not the time to rivalry,” in his opening remarks for the G20 meeting. Many ministers attend the G20 meetings online because of the pandemic.

“It’s not the right time to start a new conflict that disrupts global recovery, particularly one that puts at risk the safety and security of the entire world such as the current events in Ukraine.”

Analysts warn, however that policy coordination may be difficult due to the diversity of G20 members. These include allies the United States as well as rivals China or Russia.

After their Friday two-day meeting, the G20 finance leaders will likely issue a communiqué.

The U.S. Federal Reserve is looking to raise interest rates, and its counterparts are following suit. G20 finance leaders will likely call upon major central banks to clearly communicate their intent to avoid big market swings.

According to Reuters, a document containing the consensus position of European G20 member countries, G20 policymakers will also warn emerging nations about potential market fallsouts from monetary tightening.

The G20 Finance Leaders were informed by Sri Mulyani indrawati, Indonesia’s finance minister.

She said, “In this respect, global coordination and a discussion regarding exit strategy will be essential.”

G20 members face the challenging task of managing policy in the context of global differences regarding the speed of recovery following the pandemic.

COVID-19 Omicron Omicron variant cases may be declining in some wealthy countries but they remain high in many developing countries including Indonesia.

Wednesday’s warning by the International Monetary Fund was that downside risks continue to be a major concern, with renewed restrictions on mobility in certain countries and mismatches between supply-demand likely to slow growth.

In response to rising default risks and increasing demands for more debt, IMF said that it would be seeking G20 support in strengthening the debt restructuring framework for poor country.

Janet Yellen, U.S. Treasury Secretary, will ask her G20 counterparts for help in overcoming bottlenecks in vaccine deployment and to support investments in pandemic prevention. This was a U.S. Treasury official who spoke on Tuesday.