 marks today, and it was a real honor, especially such a treat for all of us today to have such a distinguished pair of leaders, the two G20 Sherpas from two very close allies, the United States and Australia. So thank you, Matt, for inviting me. This discussion is timely. I think it's very important. It follows visits to CSIS by Foreign Minister Julie Bishop. She's been here twice since the Abbott government took control down under, and we have a very close relationship with Australia here at CSIS, and I think that underlines in part the very strong discussion between Australia and the United States about things like the global economy and how delicate that is, global economic governance and how Asia is organizing itself. I think the G20 is particularly significant in this light. There will be one of the largest gathering of leaders ever in Australia in November, November 14th and 15th in Brisbane when the G20 members meet, and remember half of those G20 leaders are from the Asia Pacific region. So very, very important discussion for all of us who think about Asia nonstop. I would like to quickly introduce our two guests and Matt. You have their bios, so I won't go into this deeply, but it's always a good sign when you have strong women leaders in charge of something. I've noticed that, and this is the case certainly here. Dr. Heather Smith is deputy secretary of the Department of Foreign Affairs, I'm sorry, in the Department of the Prime Minister's office of the Cabinet, and she's Australia's G20 Sherpa. I really loved seeing that she has her PhD from ANU, which is, for those of us who do Asia, it's like a vortex in the world. One of the locuses of the most prescient thinkers about Asia and economics. She held obviously other very important roles as she was working through her career, including the Office of National Assessments, which is another favorite of ours here at CSIS, so love seeing that. Welcome to Washington. Caroline Adkinson is the deputy national security advisor for international economics at the White House. She has ably succeeded Mike Froman in that position, and for her sins for taking that position, she's also the G20 Sherpa. Mike Froman had that position before he went over to USTR. Matt Goodman is perfectly positioned to moderate today's session. He worked for Mike Froman at the White House when Mike was the Sherpa, and the Sherpa is the leader's personal representative to the G20, so both these women play that role. Matt was Mike Froman's yak, and I begged him not to make me say that, but he said you're going to have to say it, and I'm not even going to try to explain what that means. Matt, with that, I'll leave the yackery over to you, and I look forward to the discussion. Thank you. Froman used to call me a yak of all trades because I did a lot of things for him, but I've had my coat trimmed since then, but thank you, Ernie, and let me join Ernie in welcoming everyone to CSIS, especially our distinguished guests, Heather Smith and Caroline Adkinson, and let me also say a word of welcome to people online who are watching us. We know we have a big following online and on Twitter at CSIS, with I think a hashtag CSIS live, is that right? So welcome, welcome everyone. So the G20, in my mind, is really about three things. It's about problem solving in the extreme crisis management, but basically problem solving, about agenda setting for the global economy, and about building habits of cooperation among a group of countries that have not all had the experience of participating in global economic governance. So I'm going to frame my questions around sort of those three broad areas, and I'm going to, because we started a little late, I might steal a few minutes at the end if our guests and all of you will allow, but basically I'll sort of truncate my part of the questioning, and then we'll move to questions from the floor. So let me start with the problem solving part and ask kind of both of our guests what they're worried about, and I think it would be not sensible to start without asking about the issue that everybody is reading about in the papers these days, which is Ukraine. I'm not going to ask about the geopolitics of Ukraine, but I would be interested in Caroline your view of what's at stake economically and what the challenges are in Ukraine. Well, thanks very much Matt, and thanks very much to all of you, and apologies because I think it's my fault that we started a bit late or my boss is fault, something like that. For Ukraine it is obviously an important economy in Europe, it's not huge, but it is one that has been badly mismanaged, but has a promising future and can have a promising future. Right now there are a lot of pressures, there are financing pressures and there is need to take a difficult reform measures, including importantly in the energy field where there have been expensive subsidies, and one of the other areas is on exchange rate management and budgetary management. We are encouraged by the fact that the government now in Kyiv has committed itself to doing reform, it is invited in a team from the IMF, the International Monetary Fund, which is already there, and as you will have seen on Sunday G7 Finance Ministers agreed on strong support for Ukraine multilaterally and bilaterally and called on others to put forward support. We did that overnight Sunday Monday, Secretary Kerry and then Secretary of Finance Minister Liu put out statements about the kind of support that we in the United States are preparing to give to Ukraine, which includes a one billion dollar loan guarantee which we need to have authorised by Congress along with our, we hope with our support for IMF quota reform because the IMF will be a big part of any financing package. We're also looking in particular at four areas for Ukraine, technical assistance in monetary and exchange rate management where we've got advisers already on the way or on the ground, a very important issue both politically and also for good governance, we're sending some support for anti-corruption measures and also for asset recovery, legal experts, and we expect that we will pull together, but international experts on that will come together from the major financial centres soon. We're also giving them support on energy reform and on understanding the legal basis or how to deal with any trade issues that may arise. So we're in there and today I think the EU announced that they were ready to put up money, so we can see the shape of a financing package that could go along for Ukraine to support reform and I think that will all be very positive as you said, leaving aside the enormous political security and other issues. And as you will have seen of course the G7 also came together to say that again on Sunday the leaders all said that it was unacceptable, the violation of Ukraine's territorial integrity and sovereignty and they gave leaders support also for Ukraine's financing to help Ukraine's political and economic situation. Okay, thank you. I'm sure we're going to come back to that topic, but let me turn to Heather and ask more broadly about the when you look out on the global economy, what are you worried about? What do you think the big challenges are today? Well, thank you Matt and thank you Ernie and thank you very much for coming along today. It's a very important forum so Australia is very proud to have the presidency and we see ourselves as stewards of G20 through this year and hopefully we will leave G20 in a better space when we finish by November. I think the key thing that is on our minds is really the concern about the pace of global growth over the next decade and we're obviously in a very multi-layered transition when it comes to the variability of growth across the global economy and also within G20 we're seeing a cyclical recovery in a number of economies from the very deep recession that we've seen since the financial crisis but we're also still in a process of ongoing repair of dealing with financial stresses in the system so the real challenge we face is how do we increase growth potential of the global economy and I think even though we are coming out of the deepness of the crisis when you look at the actual indicators we still have potential output GDP per output is still eight percent below what it was between 1998 and 2005 and this is before the lead up to the financial crisis when growth was very strong so the OECD tells us that that gap won't actually close until 2021 so we've got a lot of catching up to do in terms of growth but I think coming back to that key question is where is the the next driver of growth in the in the international system we've seen the US performing better I think the EU is showing signs of turning the corner and Japan under Prime Minister Abe is embarked on a very very ambitious three arrows approach I think it's going to be very important that the structural reform element of that really really becomes important in driving Japanese growth but also is important for the Asia and also for the rest of the world but I think we still have a policy mix that's unbalanced across across the world we have fiscal policy that still is very much focused on consolidating public sector balance sheets so from Australia's point of view we think focusing on both the macro economic coordination aspect as well as structural form is really the the avenue on which to to try and build momentum within the G20 I think the the other issue we need to be clearly concerned about is the high level of unemployment across the world the ILO does not see any real growth in jobs in the immediate future and that is very concerning for all of our for all of our economies and all of our society so we really do need to think about how to raise participation in the global economy and also looking at at labour market policies within within all of our economies trade is also an area when you look at the overall trends it's well below the the growth rate of the last three decades I think we've seen some improvement more recently but this is quite concerning trade has always been a very important engine of global growth and there may be structural features that are underlying that but they're also cyclical features and real barriers to countries engaging in trade so so we really do need to think about that I think also in terms of what's what's concerning are the underlying features of the global economy and there be two things that that I would highlight firstly is that global interdependence is key to all of us but I get the sense over recent years that there's been some waning in the commitment to try and enhance our global interdependence and that's perhaps not surprising given the the deep recessions that that some economies have faced but it really is important to generating global growth that we integrate more with each other going forward I think also when it comes to policymaking we've seen enormous reductions in poverty across the world over recent decades and that's given rise to to middle classes in in many parts of the world which now have a very a very strong and a very good voice in in in many countries and that empowerment I think has really raised expectations of what governments can deliver and what they can't deliver so that's a very positive force in many ways but it's also getting harder for governments to make deep reforms and I think we that brings us back to how we have to have a number of constituencies and a number of other forces that that can help help governments embark on reform and it's not it's not just the the role of government so I see some of those underlying trends also as being perhaps concerning going forward as we try to embark on addressing some of these challenges. Okay thank you that's very good overview and we'll come back to sort of how you plan to address some of those issues but Caroline what's your view of the global economy and where do you think that the areas of most concern are whether in the advanced world the emerging world China wherever you think is the place we should be focused on. For all of the G20 the big issue is as Heather said getting a strong and stronger recovery from the recession. We are certainly in a recovery we the private sector has been adding jobs for for many quarters now in the United States but unemployment is still too high and we need to work and President's budget today lays out a lot of a lot of issues and places that we think we can make progress. Internationally that's also important internationally what we've tended to say is be ambitious go for the jobs go for growth we don't need to settle for a kind of suboptimal recovery and one of the problems with this slow recovery is that people who are out of work tend to stay out of work for longer and so the long term unemployed are a major problem in the United States that we're taking specific measures to look at in some other economies in Europe for in particular youth unemployment is a very particular problem. The other so the overall frame of we've got to grow faster than than we would do if we didn't take action I think is completely right. We also have to grow in a balanced way we haven't got rid of the problem that was that was identified early on in the in the G20 of the need of the fact that growth have become unbalanced in the world with some very big surpluses some very big deficits we all need to grow sort of domestically we can't grab growth from each other so that's part of the very nature of the G20. A couple of other issues special sort of within that frame we agree I think in the G20 that there is a big infrastructure deficit and investment deficit China's a little different because they have very high rates of investment although there is also a case that they need some some improved infrastructure obviously they're growing been growing very rapidly so that's not so surprising but it's a question of where and how and why they invest. Another issue on the employment side and I completely agree with Heather we need to listen to a lot of groups in fact I'm going this afternoon to talk to a group at AFL-CIO about how they see the global economy and the and the G20 agenda we talked to the B20 as well. Another issue is we have a whole lot of the labor force that or potential labor force that doesn't contribute or that is in informal and low-paid and unprotected jobs at the moment and that's women even though Heather and I are up here that's still rather unusual and even in our societies and we know that in many other societies the gap between never mind pay but just the gap between how many women and men are part of the labor force is is wide and if that gap were narrowed that would yield the possibility of particular increase in growth so we want to look in particular at that during this year and then finally as the president has said and I think that world leaders agree and the UN secretary-general is also I mean there's very much high-level focus on the issue of climate and energy efficiency and in the G20 whether it's Beijing whether issues of air quality other countries where whether have been extreme weather events including here or impending water shortages I think there is a growing understanding of the importance of addressing that and the G20 being as the last thing I'll say being a sort of political body when leaders can come together is sometimes able to make a breakthrough you said problem-solving and gender-setting and part of the problem solving obviously initially was all around getting pulling back from a great financial crisis getting worse but there is there are also other big global problems getting trade going but also addressing climate change as a big global problem let me I want Heather to have a chance to lay out the Australian framing of their priorities but before I do that let me just ask you about about the challenges in the financial markets in the first couple of months of this year and what do you think the sources of that are those are reflection of and you could sort of look at that glass half full that you know the advanced world is doing a little better and so it's highlighting perhaps that the emerging world is not doing as well I guess that's an economist way of being glass half full but you know the people are talking about you know these are very specific idiosyncratic problems in individual countries what what do you think is going on why has there been this volatility in the last couple months I think there have been two things going on one has been a generalized pull of funds into the emerge into the advanced economies in particularly the United States as markets anticipate that we've got a stronger recovery and that the said tapering has begun and maybe it will continue and there had obviously been a big push of capital into emerging markets which some emerging markets found quite difficult to manage and felt that that was driving up their exchange rates too too hard so that's a kind of secular secular secular shift that can lead to volatility as it occurs I will say that two points about it one I think the G20 is an incredibly useful forum even though I know there have been some comments about this because it does pull together not just the leaders once a year but finance ministers and central bank governors they all met in Sydney I think earlier two weeks yes a couple of weeks ago where they could discuss these issues and how to manage how best to manage and that's something that was just didn't exist in the old days so I think that's very important and another thing that that I think is somewhat reassuring is that many of the emerging market economies that have had crises in the past when their exchange rates were fixed now have more flexible exchange rates more flexible monetary policy and many of them have built up buffer of reserves so the ability to manage this shift I think is greater than it might have been now that on top of that there are of course as you say idiosyncratic developments some countries may look more or less vulnerable than others and then there are politics and we've seen politics geopolitics security we've seen that that can also be an issue so I think those are okay all right thanks so Heather what are you going to do about it what's the G what is your how do you frame your priorities for the G20 thanks Matt before I answer that question I'm not dodging that question but just to to reinforce what Caroline was saying because I was at the the finance ministers and central bank governors meeting in Sydney two weeks ago and there was a very good discussion and it does show the evolution and maturity of G20 where you you can actually now have a very fruitful conversation which we see countries coordinating their their actions at least in terms of explaining and communicating their intent going forward and a strong commitment to ensuring that the global economy is resilient and that there are safety nets there so I think it's quite quite legitimate that you would expect given the normalization of monetary policy across a number of economies going forward that you would be seeing relative price adjustments taking place in economies in addition to the factors that that Caroline has mentioned we live in a very heterogeneous world now in terms of what the emerging market economies are they're not they're not they're not a group it's not like the Asian financial crisis there's high diversity and but the fundamentals still remain important you know in terms of having flexible exchange rates and current accounts that are manageable I really just I think standard underlying features of any economy at any point in the cycle and I think you can see a differentiation between economies that have those characteristics and those that don't notwithstanding the politics also comes into play so in terms of what we're going to do about it where we're going to to try and firstly including what was agreed two weeks ago in Sydney was to for the first time in G20 set an aspirational growth goal where we are asking G20 collectively to try and raise global growth by 2% over the next over the next five years which in essence where we're asking economies to rather than have potential growth between 2014 2018 at 3.8% we're trying to to raise that bar to to get it to 4.3% it's an aspiration it's it's designed to to continue to place pressure on all of us to deliver under the G20 agenda and I think the key key focus words if you like for Australia's presidency will be very much around growth resilience and governance and particularly around growth we have inherited a good agenda from from Russia where it was agreed by leaders in St Petersburg that by the time we get to Brisbane each country would present a growth strategy and within that growth strategy we have agreed that we will focus on three key pillars of reforms the first one is around raising the financing of investment particularly through infrastructure investment as a share of GDP is at its lowest level in 50 years that tells us that the private sector is very risk adverse so we really need to look at measures that will facilitate investment particularly in infrastructure we know that there are short term stimulus effects from from that investment and also long term productivity and competitiveness effects from from investment and there is a huge $70 trillion deficit around the world in terms of infrastructure investment key challenge that that we face throughout the year is how do we ensure that we have the financing mechanisms how do we make sure that we are the private sector in particular has a strong role in contributing to that and we can come back to that later secondly as Caroline mentioned labour market participation it's very important that countries look at their labour markets we're asking countries to think about individual and collective actions that will help create quality jobs going forward and that we help address the supply and demand mismatch that we see within the labour markets and that includes such things as what can we do in terms of skills and training and vocational training to help those people who perhaps wanting to enter the workforce or have been unemployed for a long period of time it's also about thinking about raising the workforce rate as Caroline mentioned I think female participation youth participation are two key themes that G20 is is wanting to focus on this year I think female participation is very important for productivity in in all economies but it also has many important social aspects as as we know the third pillar is around trade I think this this year in G20 we're really wanting to have a conversation that that talks about trade as a driver of growth what can we do in our economies unilaterally to increase trade by removing barriers to supply chains if you think about global trade now it's not it's not just final goods crossing borders with all within G20 economies about 30 to 60 percent of trade is in intermediate goods which means they move back and forth back and forth there is no such thing as a as a domestic input so it's very important that we free up barriers that that enable business to to have opportunities which in turn gives rise to activity and helps with with job creation so all of those three pillars as well as what any other reforms economies want to offer up we are asking countries to put put these on the table essentially by the middle of this year we're through the shepherds and through the finance deputies process we will seek to assess and engage in a process of peer review to try and raise the level of ambition in order to try and meet this this growth objective the the second the second area is really coming back to what we were talking about we're really in the context of Ukraine how do we ensure that we've got resilience resilient structures in place to enhance growth but also to deal with any potential volatility going forward and following the the financial crisis there's been five years of work very good work in the G20 on focusing on the on on strengthening financial regulatory issues across all G20 economies and there's a whole body of work which through the course of this year is is due for delivery and that's really important because it gives a signal that governments are working on financial stability that that people have confidence in the system that it can be reshearing that will reduce the call on government balance sheets in the event that there's there's other crises it's about building confidence in in the financial system the other the other area that the G20 is focusing on is on on taxation where if you think about how the world economy has changed that we have quite outdated taxation arrangements across many countries and that with the mobility of firms you don't always necessarily pay the tax in the place where you earn the money so I think leaders are very very focused on what can we do to ensure that we have greater convergence between our tax administration systems and the movement of profits around the world there's also a perhaps more esoteric agenda which Australia is wanting to focus on and that is really around trying to to streamline the G20 agenda so that we focus on a few key issues there's a huge amount of work that goes on within G20 that is very important I would say each president inherits two-thirds of that agenda and that's very important work but from Australia's perspective we would rather focus on a few key issues and do them well and and get some really important outcomes particularly around delivering growth rather than then focus on on all issues and and not really achieve as much as we would like so that's that's a broad outline of our agenda there's some other governance issues that that that we can come back to that mentioned that the role of G20 but we are thinking about that in the trade and energy space but we can come back to that great that's a very helpful overview and let me commend to all of you the G20 website the Australian government's G20 website which has a nice framing of the growth and resilience agenda with a nice sort of table that divides up with different colors it's actually quite quite easy to grasp because it is a broad agenda well there are a thousand things I want to ask about I do want to give people a chance from the audience asked but let me ask since you've talked about let me ask two things first the quota reform you touched on in the Ukraine answer but this is one of the big disappointments of the G20 that the US brokered and pushed an agreement to try to re reallocate shares and shares as they're called in the in the International Monetary Fund and other international institutions in 2010 and that was a very significant commitment by the G20 in substance and sort of from a perception point of view about the shift of the you know voice in the world from the advanced world to the to the emerging world is it as it emerged the United States is the only country in the G20 that has not implemented that that commitment and I wonder whether and when we're ever going to do that and what can be done and how we can all help to encourage that and then I'd like to ask Heather what she thinks about that issue well I can tell you that that President Obama is fully committed to getting this support for we need support from Congress to make this change we put this forward in the budget last year we were very hopeful until the last minute in the negotiations of the omnibus bill that we would manage to succeed in getting that in the budget in the end the price that was put on it was you know not appropriate and and almost the negotiations broke down and what we're very hopeful but since then and urged on by many of you that are here we have been working from the White House with Treasury obviously Jack Lew has been working the phones but so have we and with with also colleagues from the State Department and the Department of Defense and I've spoken just this week or over the weekend with Secretary Kerry and Secretary Hegel about who fully on board with the importance of getting this reform legislation passed so we are hopeful that we can manage to to press this forward in the coming you know short period ahead we're well aware that the rest of the world is waiting on us I think that they've made that very clear in meetings to Secretary Lew and also to President Obama who understands that it is extremely important that this reform does get passed do you want to comment on that? No thank you Matt I think this is a core issue for G20 because it goes to the credibility of the institution to deliver and it's very symbolic because the G20 does actually reflect the I guess the 21st century dynamic of shifting relative weight shifting economic and strategic weight across the world so the G20 is a body that is inclusive I think and representative and the institutions that we need for the time so so from a straight point of view we've been we've been very very supportive and been very much involved in in this issue for a long period of time because we share our executive director chair for example at the IMF with Korea which we we made a decision to do this several years ago because we thought it was very important that that other voices now start to have a greater role around the IMF board but having said that the administration has worked enormously hard Caroline has worked enormously hard the president is very very committed and the secretary is very committed so they're doing all they possibly can and and that is certainly recognized around the table I think we're moving now from a it being a representation issue to really it feeding into how we think about resilience in the global economy and Ukraine is part of that story but the need to make sure that the IMF is seen as as a as a credible well funded operating institution that provides safety nets when required is really the key here and that's that's that's really important in terms of why we continue to need to see quite a reform and governance there will be a finance G 20 finance central bank governance meeting here in April around the spring meetings and it is our hope that that we we can see some some movement on this in April but it's very important a lot of the emerging market economy see it as as really key indicator of does do other countries seriously take their voice around the table and it's very important that we keep providing support to the administration but it's very important for the credibility of G 20 that we try and get the 2010 reforms moving so that we can then start the 2015 process where we hope to take the government's reform further okay thanks well I was gonna ask some institutional questions but I think some of them have been touched on already and so let me just opine that that I think the as you said the G 20 is under challenge in terms of its legitimacy even because it it hasn't always been able to deliver on its commitments and and I think it's it's it's key to me legitimacy is a function of sort of inclusiveness and effectiveness there's a sort of sweet spot there where it has been enough of the right people in the room getting enough of the right things done to be able to then enjoy you know broad credibility and and even legitimacy so so Godspeed with that with that agenda and streamlining I think is a great idea okay I'm gonna now open it up to questions we do have microphones when you get the microphone could you please identify yourself and try to ask a brief question yes ma'am in about the third or fourth row there my name is Nancy Alexander with a hundred full foundation and for all the reasons that the three of you have mentioned we really appreciate the administration's hard work to get the IMF reform it is so necessary for the legitimacy and it gave me hope that you're dealing with it at such a senior level we're working with the civil 20 which has a very very trivial amount of clout compared to the business 20 and even the thing 20 and that's a concern for us in and of itself but we have two questions one is that in 2009 in terms of this same issue of carrying through on commitments the US proposed in Pittsburgh an elimination of fossil fuel subsidies and it really seems to be completely stalled you know you mentioned it in Ukraine you know but how about globally and the civil 20 has four like loci of work and one of them is infrastructure and we have two concerns about that in watching the infrastructure work really over over five years one is that the climate work which is so important seems to be pretty divorced from mobilizing finance for infrastructure and I hope that impression is wrong I'd like to hear what you think about it and secondly there has been no discussion at least in posted documents and and communicates about norms in terms of transparency procurement freedom of information social and environmental safeguards in fact the St. Petersburg accountability report gave the G20 a black mark for their work on environmental safeguards so if you could cover those issues of fossil fuel subsidies and the climate impacts of infrastructure and the norms that appreciate it okay thank you a number of questions and comments embedded in that and while you're thinking about that let me just clarify for non G20 watchers that there's been a whole proliferation of other 20 groups including the civil society or or C20 I guess there's a B20 representing business interests there's an L20 there's a T20 think tank group which is probably the most important of all of them and so just so you keep up with the Lexicon it's kind of confusing Heather do you want to address either of those sets of issues? Oh yes Caroline is working very hard on the fossil fuel subsidies area so I should say more broadly on on G20 as I mentioned there's there's a lot of work that goes on within G20 but sometimes I think it's important to have a discussion what G20 isn't rather than what G20 is and I think when it comes to two issues we we have to keep two two things in mind one is where can G20 add value and secondly where can the issue be best progressed and I think fossil fuel subsidies is a good one for G20 because it helps build political momentum where it is hard to get momentum elsewhere and Caroline can talk about the the partners that we're trying to to bring into to that to that process on on civil society I think again what I think really matters when it comes to the engagement groups is narrowing down the focus of where you think can best add value and I think your focus on on infrastructure and investment around clean clean energy is is a good one because it's really up to countries to decide when we're asking them to make commitments around infrastructure where they put their effort and we know that within with the energy and transportation system and water and sanitation in developing countries that they are they are big gaps so I would encourage the C20 to to focus on that it can focus on any any particular area but on the environment and clean energy I think that's that's really important on I think your your other question there is an anti-corruption working group that is focusing on on greater transparency and many of those issues now that that work is an example of work that just continues to move on there they've done some very good work over recent years they're doing review of their work program and are about to embark on a new set of work issues so I wouldn't be disheartened by that I actually think there's there's some very good work who are strategy chairs that working group with with Italy but I would just caution that G20 cannot focus on on every issue out there we really need to to think about how do we use the political capital of our leaders to best effect and how do we use the G20 institution to best effect and where can we progress issues elsewhere that may get more traction than perhaps in G20 yes on fossil fuel subsidies you absolutely right that this is extremely important I think there has been progress not necessarily within the G20 frame and then there's also been some within the G20 frame so on the first in the past two or three years there's been more focus including from the IMF where David Litch and the first deputy managing director gave a powerful presentation probably a nine months ago or a year ago or something about the economic and fiscal costs of fossil fuel subsidies and and there has also been work in the World Bank and with individual countries are a number of countries who have been grappling pressed really by budgetary issues to deal with this question of reform and I think there's a part of the issue goes to a second thing about transparency part of what we've been suggesting is that if people in a society know that these subsidies overwhelmingly benefit the wealthy because they're the ones that consume most energy overwhelmingly benefit large industries because they're the ones that consume most energy and tend to the extent that cheap energy feeds you know chemical and other industries in some of these countries that have big energy subsidies they're actually not even labor intensive industries so the whole structure distorts the economy in a way that is not very helpful for leaving aside even issue of energy use and the environment is not helpful for the middle classes and the poorer more vulnerable and so we've been coming at it in an individual case and encouraging the IMF and the World Bank when they're dealing with individual countries to point out the budgetary costs and to suggest that as you as countries put in place a fit you have to phase these things a phase reform that the money gets the savings get at least partly directed towards the most vulnerable but with as part of you know what we call conditional cash transfers and so on and that work has actually been going on in a number of individual countries now in the G20 we have been calling for a peer review of as a way to again improve the transparency around this issue because a lot of countries will start off saying well we don't have any subsidies and so part of it is just to to work to come to a common understanding about how pricing works and who it benefits and who it is a cost for and we expect that during this year and possibly at APEC but certainly by the time we're we're in Brisbane it will be possible to point to some peer reviews that are under and we've been ready to volunteer for that for for a while we're working with partners a few countries did agree around last year's APEC to do that and we it's well like many of these things once you get going then you can expect that there will be more support so on the other issue of I I think Heather's absolutely right that for the various 20 groups it's important to focus on a few key issues and we've said that certainly to the B20 and L20 and so on and I think that you know the traditional one you and I have spoken about this before in in when I was in a different role the push from civil society for transparency I think has really changed the way that many of us work in the public sector and in particularly in the international financial institutions the IMF and the World Bank it just is much more information out there and and we are pressing Heather mentioned energy that is another area where there's price volatility in part because there is a lack of transparency from some big consumers and producers that's one area it sounds a little bit wonky but it's leaders are not going to discuss that but it's part of the work that we all have to do is shippers and guiding these working groups and the anti-corruption working group is very important we one of my staff has just come back from Australia where he's been working on that issue pressing in the G20 for countries to subscribe to the anti bribery conventions pressing in the G20 for and gradually there's peer pressure pressing for the EITI you know the extractors industry transparency is another thing that is that has made progress in the G20 so I think there there you know there's a long way to go but at all of these issues people get more sensitized to you know through this process and I think these are both examples of the fossil fuel subsidies and and and the anti-corruption work where you know all three of the things that I mentioned at the beginning about the G20 come to come to light I mean problem solving agenda setting and in that regard you mentioned APEC I see the Chinese are taking up the fossil fuel subsidies issue because that has both budgetary and environmental implications for them and they they sort of get it so so that leads to the third thing which is it builds habits of cooperation I think having these conversations helps to get new players in the conversation and thinking about these issues and acting on them so I think that's very good. Okay next question yes ma'am right here actually what I'm going to do is I'm going to take a cluster of questions so this lady then that lady then the woman in blue in the back there. Good morning ladies and gentlemen my name is Rosemary Seguiro I'm the president of Hope for Tomorrow I want to thank CSI for this wonderful event the White House I want to thank President Obama for the wonderful initiatives he has put for Africa I come from Kenya. Thank you so much Ms. Sita I wanted to talk something about civil society women participation and leaders young leaders like the one President Obama is bringing 500 leaders from Africa I look at this as very important I asked the Russian Minister for Finance I attend the World Bank and I'm one of your meetings I ask them why don't you put women participation into the G28 and G20 and the young people they are the leaders of tomorrow they I think things can change if you involve us as women and the young leaders who are leaders for tomorrow because when the leaders go they'll have to know and want to know what is G20 what does it do so I think you should put more emphasis on including people organizations like civil society and women participation and young people how do we get into that as he was said yes as the World Bank and IMF annual spring meetings thank you. Okay thank you and I would just broaden the question a bit in addition to those points to say you know if you could comment on the development agenda within the G20 and what what the G20's role can be or should be in development issues yes ma'am. Yes Christy Hughes from Reuters a question first for Caroline to follow up on your comments on Ukraine what sanctions could be imposed on Russia and a suspension or exclusion from the from the G8 and option there and secondly for both Caroline and Heather in terms of regulation of Bitcoin is that something that corridor should be considered at G20 level rather than having countries going it alone such as Japan's plans currently. Okay yes ma'am in the back. Julius of Chiengkhoi so I'm here just to follow up on the Reuters Reuters right question how do you expect Russian participation being shaped by the current crisis in the upcoming summit and do expect under any circumstances that G20 can become G19. It's already the G50 if you have the EU all the invited yes so it would be 51 or something. Okay so we have a question about development women and young leaders Russian exclusion bitcoins who wants to take on any of that we start over here Caroline. Sure just to talk about Ukraine and Russia first of all I'm I will third at the beginning to our leaders statement on Sunday to I'm not quite sure what the time is now but I know that Secretary Lew is testifying this morning on Capitol Hill and I'm sure that there will be questions and statements from the White House podium but either and there have been statements out of the EU on sanctions I would just say there are a number of different options and obviously those are being looked at and there's one issue which is the actions that have already been taken which were outlined very clearly by US UN Ambassador Samantha Power on Monday and by Secretary Kerry yesterday in Kiev about the violation of sovereignty and territorial integrity that has already taken place in the Crimea and then there are also you know there's a broad range of options that will be kept under you know that are under consideration I think that extends also we have already announced and all of the G7 has announced that we're suspending participation in all G8 related activities now and you know that has already occurred so I think that and there was a meeting or there is a meeting I think of the of the that of the Budapest agreement which was supposed to look at was supposed to guarantee what was going on that said not my legal not the legal terminology but Ukraine with Russian participation as well as participation from others and I believe the Russians didn't come or not coming or something so although they have all we've talked we we've called for international observers to be allowed into Ukraine and Crimea so I think all of that is very much laying out that this action has costs but they're also it's important to think about de-escalating tensions and it's a matter that's under pretty much constant review our leaders are in contact we're in contact with each other so that's I'm not gonna go further than that on on Ukraine and Russia just now and turning to the other issues well Bitcoin I think we're gonna leave forever I guess it's a financial you know it is an issue for financial regulators perhaps to discuss with with one another and the other issue which is a very important one about the participation of young people in in G20 preparations discussions and so on I think that many of us are open to and do do sort of serve in a way as ambassadors as well as Sherpas ambassadors to other groups in the rest of the world on these issues there's a rather dynamic young woman that we met in Sydney who is pushing forward the youth event or the youth agenda under the Australian presidency so I'm sure Heather will want to speak about that and again it's important there's just you know there will be 24 hours when leaders come together and that's a limited and time but there are many ways in which we want to listen to bring in and interact with and listen to the ideas of others okay oh I'm sorry I can also say something about your development this is a really important part and I think it was really in you know after a year or two of the G20 leaders level that after the sort of immediate crisis had withdrawn that there was a very definite agreement that development issues were also very important for the global economy and for all of the G20 countries the G20 is also special because with it number of the country sitting around the table have very many people in poverty in their economies so it's not just that development is an issue for somewhere else you know if you take India and our Indian colleague often says that so many of the things many of the areas where we're working whether it's transparency and anti-corruption or whether it's infrastructure and investment or whether it's the rule of law or whether it's jobs and growth these are all also kind of development issues and resource mobilization is another one where we talk about and there's a whole tax agenda which we haven't even talked about that's sort of part of what's what's going on in the G20 how we think about about what the G20 does to involve and point to development issues I think is a very important we also have a development working group looking this year at financial inclusion a few other issues so that is definitely a part of a kind of settled part I would say of the G20 agenda okay thanks Helen thanks Matt I think it's very important question about the role of women in G20 Caroline's right the the chair Holly her name is Holly whose chair of the the Y20 the youth 20 is running a very focused ambitious agenda and there will be a youth summit in Australia around the middle of the year in July and but one of this is not necessarily gender specific but it goes back to my point the more that partner groups can actually focus on one or two key issues so they're going to focus on youth unemployment and and bring bring obviously the very important perspectives of what governments and others should be thinking about in trying to deal with youth unemployment and and so that focused agenda is really important there is also the what we call a small G20 the girls 20 which is a really interesting group of young women that I think I think Google or one of the Google is a major sponsor of I can't be sure but so and for that very reason that you mentioned ma'am it's about making sure there is a generation coming through who who will understand multilateralism to start with understand how to use your voice most effectively going forward but also continuing to put pressure on governments where it really matters and I we're thinking of holding some event sometime during the year where we can get this this group of young women together in particular but it's a very important point but I think when it comes to the best thing we can do for women is actually get get women into the workforce but also through the development agenda where we focus on on the key issues and on the development agenda as Caroline mentioned with the challenge for G20 again is where do you add value and I think we're focusing predominantly on three areas this year around this question around the financing of infrastructure in developing countries secondly on helping low-income countries through capacity building on their taxation regimes to try and build up the capacity of their balance sheets so they can actually fund some of the key issues whether it's health or education or welfare and and thinking about financial inclusion there is a current work program around lowering the lowering the costs of remittances the costs of transferring remittances from home to host country and there's a target that G20 is working towards I don't think we'll get there this year it's meant to be delivered this year it's very important but in addition to that really thinking about how do we use technology how do we get basic financial services into into particular areas in low-income countries because that's all about empowerment and access to to to real activity there are other areas on food security again as I mentioned there's a lot of work that continues within the G20 space and also around human capital development the other key area that the G20 will have to focus on and give some political support to is the post 2015 development goals in the United Nations and that process will play out over the next year and a half and so G20 can add value in in that space and that's important and I think also Turkey may spend quite a bit of time in their year next year as the next chair of G20 so we need to do some work to to help prepare for that on on Bitcoin it that's really interesting question I can honestly say no not at this stage we haven't but clearly you know there are a number of issues out there that that will evolve that you never know what will end up on the G20 agenda but I think at this point you'd have to really make a sort of strong case as to why G20 and not elsewhere I won't say really anything more on on Ukraine than what Caroline said except it's a very fluid situation and then we need to let the intermediation play a process sort of play out and keep watching very well November is a long time away I think last November I don't think anybody I certainly never heard of a Bitcoin so so what will be what will be on the agenda let me just say I think we have run out of time let me just say on womenomics two things one that not only do we have these two ladies on the stage with us here but the last three G20 sherpas have been women the Russian and the Mexican sherpa and and the Turkish sherpa is apparently changing hands sometime this year so we may we may continue that strength so if there's a little b boys 20 you might want to aspire to do something else other than the sherpa because it's a diamond the other thing is we're going to do the Simon Sharer program on womenomics later this year probably in September working with the Japanese government which obviously is focusing on this within Japan but they're also interested in in doing it talking having the U.S. and Japan talk about these issues internationally and work together in a cooperative way in fact that's already starting so let me end here I'm sorry we ran a bit over but appreciate your attention and please join me in thanking our two guests for their their input thank you thank you thank you both thanks a lot thank you