Changes in Store for Composition of G20? Could be time for another Asian country to join group. By Brent M.

Eastwood, PhD (2010) Although the next G20 meeting is not until November, it is being held in Seoul. Despite no indication that the group will change or add to membership, it is somewhat topical to speculate about the future of the G20. Current East Asian countries who belong to the G20 are China, Japan, South Korea, and Indonesia. Its not clear what the criteria are for G20 membership. The G20 Web site says its important the membership remain consistent over time and they claim there are no formal criteria. The group says it strives for geographical balance and population representation. Using estimates from the International Monetary Fund for 2010 Gross Domestic Product (GDP) measured in Purchasing Power Parity (PPP) reveals that the G20 countries roughly correspond to the 20 largest world economies in GDP PPP. But there are laggards in the bunch. South Africa has a GDP PPP of 521.878 (in billions of USD) and the country grew at only a 1.6% GDP increase in the first quarter of 2010. Its unemployment rate is an astounding 25%. Argentina is at GDP PPP 609.015 (in billions of USD), although its GDP growth of nearly 7% in the first quarter of 2010 is much more impressive despite its double-digit inflation. It has much better unemployment of 8.3% and its GDP PPP per capita is $14, 561 compared to South Africas $10,244 GDP PPP per capita. East Asian territories Taiwan and Hong Kong would appear to be G20 candidates, but China would howl screaming mad at the additions. So they are unlikely to join the club. Even though Taiwan has a much more competitive GDP PPP of 789.204 (in billions of USD) and Hong Kong comes in at a respectable 319.371. After those two, the nearest competitor to possible G20 status would be Thailand. The Thais boast a 573.607 GDP PPP which puts them above South Africa and below Argentina. Thailand sported 12% GDP growth in the first quarter of 2010. Its unemployment rate is an amazing 1.2%. The Thais have admittedly suffered under some political instability lately with the Red Shirt uprising. The Red Shirts have fought for the recognition of high economic inequality distributions which most countries who grow quickly suffer from. Malaysia, Philippines, and Singapore have respectable scores on GDP PPP estimates for 2010, but it doesnt look like they would be competitors for G20 status any time soon.

Geographical representation is important to the G20, so Africa must have at least one country on board. South Africas troubles may bode well for Egypt if there is a change. Egypt is growing at a nearly 6% GDP rate and its unemployment is 9.1%, much better than South Africa, although Egypts inflation is also in the double-digits. Egypt may have a leader, Hosni Mubarak, with reported questionable health. And one must admit that the South Africans did a fine job with the World Cup. But the G20 could still decide to make a change in Africa and that decision could open the field for a new country from East Asia. The G20 may have no immediate plans for changing membership, but the global economy is forever changing, and this could lead some East Asian countries to knock at the door and try to learn the secret G20 handshake.