What is the Group of 24 (G-24)?
The G-24 is a group of developing countries created in 1971. Its objective is to work together to coordinate the positions of developing countries on international monetary and development financing issues.
G-24 countries also work together to ensure that their interests are adequately represented in negotiations on international monetary issues. The full official name of the G-24 is the Intergovernmental Group of Twenty-Four on International Monetary Affairs and Development. More importantly, the G-24 is a chapter of the Group of 77 (G-77). The G-77 is the largest intergovernmental group of developing states in the United Nations (UN).
Key points to remember
- The G-24 is a group of countries that work together to coordinate the positions of developing countries on international monetary and financial issues.
- Membership of the G-24 is not strictly limited to 24 countries, and it actually had 28 full members as of December 2020.
- Although there are some exceptions, the G-24 as a whole includes many countries with excellent growth potential for investors.
- Despite the success of the G-24 in the first decades of its existence, the fortunes of its members diverged sharply to the point that the group made less sense in 2020.
Understanding the Group of 24 (G-24)
Membership of the G-24 is not strictly limited to 24 countries, and any member of the G-77 can participate in discussions. The group actually had 28 full members as of December 2020. Additionally, China has been a “special guest” since 1981. The G-24 website lists its full members as Algeria, Argentina, Brazil, Colombia, Congo, Ivory Coast, Ecuador, Egypt, Ethiopia, Gabon, Ghana, Guatemala, Haiti, India, Iran, Kenya, Lebanon, Mexico, Morocco, Nigeria, Pakistan, Peru, Philippines, Africa South, Sri Lanka, Syria, Trinidad and Tobago and Venezuela.
The original purpose of the G-24 was to assess the direction of international monetary policy from the perspective of developing countries. In addition, the group aimed to develop coordinated positions for the G-77 at the United Nations Conference on Trade and Development and other conferences. His mission later expanded to include General Development economics problems in 1976.
Although the G-24 is not an organ of the International Monetary Fund (IMF), the IMF provides services to the G-24. G-24 meetings are attended by heads of World Bank Group, IMF and senior UN officials. The group meets twice a year.
Benefits of the Group of 24 (G-24)
The G-24 has clearly enjoyed some success, as the overall economic development of its members has increased dramatically since its beginnings in the 1970s. Although the G-24 is far less famous than the Group of Seven (G-7) of developed countries, it acts as a kind of counterweight by coordinating and defending the positions of developing countries.
Although there are some exceptions, the G-24 as a whole includes many countries with excellent growth potential for investors. In addition, World Bank data shows that the market capitalization to GDP ratio in G-24 countries is generally lower than in the past and lower than in developed countries.This suggests that these stock markets should outperform after 2020, despite their volatility.
Criticism of the Group of 24 (G-24)
Despite the success of the G-24 in the first decades of its existence, the fortunes of its members diverged sharply to the point that the group made less sense in 2020. In particular, the two major economies of China and India progressed strongly, while several other developing countries lagged behind.
Overall, the Group of 24 may have moved too far apart to continue sharing goals. Many members of Africa, like Kenya, have made significant gains in the first two decades of the 21st century. On the other hand, Syria has plunged into a civil war, and the value of The currency of Venezuela dropped dramatically amid hyperinflation.
There are also big differences among G-24 members from an investor perspective. China and India are generally seen as high-tech success stories that can attract growth investors. Brazil, Mexico and South Africa have economies that are highly dependent on natural resources, which were out of fashion in 2020, making them more attractive to value investors. Finally, there were a few G-24 members, like Iran, that most investors would want to avoid altogether, even if there were no laws against investing there.