[CFE 2022] RUSSO-UKRAINIAN WAR: THE CONFLICT THAT OPENED THE PANDORA BOX FOR INDONESIA’S G20 PRESIDENCY

By: Gregorius Dhanu Dewa Wiceca

Prices to pay

Conflicts occur when individuals, groups, communities, or nations clash over disagreements on some issues. A conflict could threaten the needs and interests of the conflicting parties. This is a situation where the broad society — not necessarily only that of the feuding parties — must endure the physical, emotional, political, economic, or social consequences. Therefore, it is necessary to immediately devise a plan to resolve and deal with the impacts of the conflict.

The current conflict between Russia and Ukraine has undoubtedly caused many negative impacts on its own people and even on the global community in humanitarian, social, and economic terms. The principal cause of the Russian special military operations is the application of NATO membership by Ukraine — an ex-Soviet country bordering Russia. Kremlin fears that NATO will build its military bases in the country should Ukraine’s membership application is accepted. The construction of such facilities would jeopardize Russia’s national security considering the proximity of Moscow to the Russian-Ukrainian border. As previously stated above, the conflict also poses severe threats in economic terms for the countries in the area and the world. The steep slowdown in Russia and Ukraine will affect neighboring countries through disruptions to trade, financial, and remittance flows; severance of supply chains and transport links; impacts on digital connectivity and associated services; and heightened risk perceptions by investors. In addition, higher energy prices are having important knock-on effects on the affordability and financial viability of electricity and heating services (World Bank Group, 2022).

As for Indonesia, this conflict has had a huge impact on the country’s food and energy sectors. This is then worsened by the fact that Indonesia is also facing cooking oil and soybean shortages, which in turn are putting more pressure on the country’s food procurement. This particular problem is caused by Indonesia’s import of wheat grains from Ukraine. According to the data published by the Central Bureau of Statistics, from January until November 2021, Indonesia imported 3 million wheat grains worth USD$ 897,7 million. These figures are certainly not a small number. This effect manifested itself in the form of price surges in wheat-based products such as cereals and instant noodles. This problem arose due to the disruption in import supply flows and global trade caused by the war. Therefore, to replace the amount of the commodities supplied by Ukraine, Indonesia must look for other countries that export wheat grains. Hence, a plan to face the impacts and resolve the conflict must be implemented as soon as possible in the hopes of reducing the adverse economic effects and de-escalating the ongoing war

A diplomatic dillema

One of the means to realize the plan to resolve the economic impacts of the war is through intensive discussions in an international forum based on consultation and cooperation like the G20. In this case, G20 essentially plays an important role in settling the economic impacts of the war in Ukraine. Along with other countries and institutions possessing significant political and economic powers, it is expected that this forum would be able to produce solutions, not just for the economic impacts of the war but also regarding pandemic control. In practice, G20 discussions are divided into two separate tracks, the Sherpa track and the financial track. The Sherpa track is a discussion track of G20 that focuses on the non-financial economic issues, that is, all issues concerning energy, development, tourism, digital economy, education, workforce, agriculture, trade, investment, industry, sanitation, anti-corruption, environment, and climate change (Sekretaris Kabinet Republik Indonesia, 2021). Meanwhile, the financial track prioritizes six economic-related issues such as exit policies for post-pandemic global economy recovery, solutions to the impact of the pandemic so that future growth is guaranteed, digital payments, sustainable finance, and financial inclusion related to digital technology, and access to financing and marketing for MSMEs (Yesidora, 2021). At this crucial time where the war is still raging in Ukraine, the G20 discussion through the Sherpa track is trying to find a consensus solution to the crisis impact due to the war, both from the food and energy sectors.

In addition to the economic impacts mentioned, Indonesia’s G20 presidency also suffers the consequences. Indonesia must be able to stand as a leader in bridging global changes at this crucial time despite criticism from the West, particularly from the United States and its NATO allies, when it stood firm on its decision to invite Vladimir Putin to the forum. The implementation of this policy is to maintain the essence, cooperation, and the importance of multilateralism in the G20 (Harris, 2022). On top of that, the G20 is a forum based on consensus. This means that all participating countries and international institutions must be present and seated to discuss the global financial crisis.

In relation to the continuity of the forum, the ongoing conflict and other current geopolitical challenges pose a threat to the values of the G20. Apart from that, this conflict not only caused complications in the cooperation and coordination sector but also created the spillover effect, which challenges the recovery of global economy. Regarding other implications for Indonesia’s G20 presidency, the ongoing war in Ukraine has challenged Indonesia to continue the strategic discussion agenda for itself and the international community.

G20: A forum to stop wars?

On top of that, another implication of the war that has also befallen Indonesia’s G20 presidency is the rise of opinions and views that the themes and substances of Indonesia’s G20 are no longer relevant to the current situation. Considering the seriousness of the conflict, the G20 is considered incapable of bringing substantial changes to the war. This is a fatal misconception as the G20 has neither the instruments nor the authority to lead to a cessation of military operations. On the contrary, the G20 was essentially constructed to respond to issues concerning the world financial crisis, which at this moment happens to be caused by the war in Ukraine. G20 has evolved over the years due to leaders’ changing concerns and priorities on global governance issues, such as international finance and climate change mitigation, not geopolitics. It is not a focus for geopolitical rivalries. The first G20 summit called by former US president George Bush in December 2008 was gathered together to deal with the global financial crisis (Alexandroff, 2022). Given the circumstances, Indonesia must align its themes to stay relevant to anticipate the effects of the war without stepping outside the boundaries of the essential discussion of the forum, which is concerning the world economy. In other words, the tasks Indonesia has to fulfill during its presidency are getting more complex.

To conclude, the ongoing war between Russia and Ukraine has indeed caused many negative impacts on almost all daily life sectors of the global society. One of the most devastating of which is the economic impact concerning price surges of agricultural and energy commodities fueled by the disruption of the import flows and international trade. Aside from that, the negative impacts of the war have also affected Indonesia during its G20 presidency. This in turn led to many problems such as political pressure from the Western bloc when Indonesia sends its invitation to the Russian president, the emergence of opinions regarding the irrelevance of the themes and substances of the forum, and the increase of topics in forum discussions related to the economic impacts of the ongoing war in Ukraine in addition to the topic of pandemic control. As an addendum, the public must understand that the G20 is not the correct forum to resolve conflicts but rather to resolve the economic impacts of these conflicts since it is not a place for geopolitical rivalries.

Author Profile

Gregorius Dhanu Dewa Wiceca is a second-year French Literature student at the Faculty of Humanities of Padjadjaran University. Dewa has developed his passion for writing ever since he started reading novels as a study requirement in the French department and realized the power a word possesses. Despite his formal educational background as a literature student, Dewa is a foreign policy and international relations enthusiast at heart. Dewa can be found on Instagram under the username @dhanudwa

References

Alexandroff, A. (2022, March 25). What Russia’s invasion of Ukraine means for the G20. Retrieved from East Asia Forum: https://www.eastasiaforum.org/2022/03/25/what-russias-invasion-of-ukraine-means-for-the-g20/

CNN Indonesia. (2022, April 21). G20 Ingin Presidensi RI Lahirkan Solusi Konflik Rusia-Ukraina. Retrieved from CNN Indonesia: https://www.cnnindonesia.com/ekonomi/20220421095251-532-787669/g20-ingin-presidensi-ri-lahirkan-solusi-konflik-rusia-ukraina

Harris, H. I. (2022, April 21). Di FMCBG G20, Sri Mulyani jelaskan sikap Indonesia tetap undang Rusia meski dikecam Barat. Retrieved from Alinea: https://www.alinea.id/dunia/di-fmcbg-g20-sri-mulyani-jelaskan-sikap-indonesia-tetap-undang-rusia-meski-dikecam-barat-b2fit9CYj

Sekretaris Kabinet Republik Indonesia. (2021, Desember 7). Menlu: G20 Harus Jadi Katalis Pemulihan Ekonomi Global. Retrieved from Sekretaris Kabinet Republik Indonesia: https://setkab.go.id/menlu-g20-harus-jadi-katalis-pemulihan-ekonomi-global/

World Bank Group. (2022, April). EQUITABLE GROWTH, FINANCE, AND INSTITUTIONS POLICY NOTE: Implications of the War in Ukraine for the Global Economy. World Bank Group. Retrieved from https://thedocs.worldbank.org/en/doc/5d903e848db1d1b83e0ec8f744e55570-0350012021/related/Implications-of-the-War-in-Ukraine-for-the-Global-Economy.pdf.

Yesidora, A. (2021, Desember 22). Mengenal Sherpa Track dan Financial Track, Dua Jalur Pembahasan G20. Retrieved from Katadata: https://katadata.co.id/sortatobing/berita/61c306c27a196/mengenal-sherpa-track-dan-financial-track-dua-jalur-pembahasan-g20

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