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Bali (Indonesia) (AFP) – A group of 20 finance ministers and central bankers gathered in Indonesia on Friday for talks on the fallout from Russia’s invasion of Ukraine, with the host warning them that failure to deal with energy crises and food would be catastrophic.

The two-day meeting on the resort island of Bali began in the shadow of a war that has rocked markets, driven up food prices and fueled sky-high inflation, a week after the top Moscow diplomat left the talks with the foreign ministers of the forum.

In her opening address, Indonesian Finance Minister Sri Mulyani Indrawati called on ministers to work together in a spirit of “cooperation” because “the world is waiting” for solutions.

“The cost of our failure is more than we can afford,” she told delegates. “The humanitarian consequences for the world and for many low-income countries would be catastrophic.”

Top figures in global finance, including US Treasury Secretary Janet Yellen, were due to discuss the rebound from the coronavirus pandemic, but the war in Ukraine and its impact on an already fragile global recovery topped the agenda.

Canada‘s Finance Minister, Ukrainian-born Chrystia Freeland, told the Russian delegation they were responsible for “war crimes” in Ukraine because of their support for the invasion, a Canadian official said.

“It’s not just generals who commit war crimes, it’s economic technocrats who allow war to happen and continue,” Freeland said during the opening session, according to the official.

Russian Deputy Finance Minister Timur Maksimov was sent to attend the talks MADE NAGI POOL/AFP

Russian Finance Minister Anton Siluanov and Ukrainian Finance Minister Serhiy Marchenko participate in the meeting virtually.

Moscow instead sent Russian Deputy Finance Minister Timur Maksimov and Bank of Russia head Elizaveta Danilova to attend the talks in person.

Freeland went on to say that war was currently “the greatest threat” to the global economy, according to the official, echoing Yellen’s comments a day earlier.

Yellen called Russia’s war in Ukraine “the biggest challenge” to the global economy and said members of Putin’s government “have no place” in the talks.

After the Russian delegation addressed the meeting, a Western official told AFP that Moscow had not sent its finance minister or central bank governor in person “after the very direct criticism” Foreign Minister Sergei Lavrov was confronted last week during the talks in Bali.

No clutch

The meeting largely focused on the food and fuel crises plaguing economies around the world as a result of war.

Italian Economy Minister Daniele Franco addressed the ministers with the message that they “have a key role in preventing food insecurity from turning into a humanitarian crisis”, according to an Italian official.

Yellen is lobbying G20 allies for a cap on Russian oil prices to choke off President Vladimir Putin’s war chest and pressure Moscow to end its invasion while cutting energy costs.

US Treasury Secretary Janet Yellen was to condemn the Russian invasion
US Treasury Secretary Janet Yellen was to condemn the Russian invasion MADE NAGI POOL/AFP

In April, Yellen led a multinational strike by finance officials as Russian delegates addressed a G20 meeting in Washington.

But there was no walkout on Friday after Yellen was reportedly fired over a possible repeat of that joint action a day earlier.

A final statement is also unlikely to be issued at the end of the talks on Saturday due to disagreements with Russia.

– “Act together” –

G20 chair Indonesia – which pursues a neutral foreign policy – has refrained from disinviting Russia despite Western pressure

“It’s not an easy time given the diversity of our membership…and also the differences in our positions and viewpoints,” Indrawati said.

“We must act together to demonstrate why the G20 deserves its reputation as the premier forum for international cooperation.”

But it was difficult to get all parties around the table in person.

Alongside ministers from Moscow and Kyiv, Chinese Finance Minister Liu Kun and Britain’s new Finance Minister Nadhim Zahawi were only in attendance virtually.

Ministers met to discuss fallout from Russia's war in Ukraine, particularly on energy and food
Ministers met to discuss fallout from Russia’s war in Ukraine, particularly on energy and food MADE NAGI POOL/AFP

The head of the International Monetary Fund, Kristalina Georgieva, will appear in person after saying on Wednesday that the global economic outlook had “darkened considerably” due to the invasion of Moscow.

European Central Bank President Christine Lagarde will attend virtually, but World Bank Managing Director David Malpass will not attend.

The meeting is a prelude to the leaders’ summit on the Indonesian island in November, which was expected to focus on global recovery from the Covid-19 pandemic.

Other issues discussed by ministers included digital financial inclusion – with more than a billion of the world’s population still without access to a bank account – and the deadline for an overhaul of international tax rules.