G20 should be a premium forum for international cooperation where leaders can provide political momentum to get things done, said Mike Callaghan, director of the G20 Studies Center with the Lowy Institute for International Policy, a well-known Australian think tank.

In a recent interview with Xinhua on the eve of the G20 summit to be held in Brisbane from Nov. 15 to 16, Callaghan said that the world moves away from the immediacy of the financial crisis, but it becomes a harder challenge when it is not so apparent.

"It is now more than ever that the world needs a degree of confidence, a degree of optimism that countries can demonstrate that they are working together to solve some of the difficult challenges," he said.

"The strength of G20 is that large countries can push through and overcome some political road blocks. They can give strategic corrections and can give some degree of political momentum to get something done."

Callaghan identified a number of challenges the world is facing at the conclusion of the last financial crisis, with which the G20 summit was first held in 2008 to tackle.

"The challenge is that the global economy is operating below power. We are seeing growth potential of countries having been low. Some countries still haven't recovered the lost output since the crisis. As the IMF said the down-size risks are growing, we have got many tensions," he said.

One of them is the concern that the financial market would be the cause of and be supported by large burst of liquidity through the unorthodox approach to monetary policy, through quantitative easing, he said.

"There is lots of liquidity in the system that the financial market are in many aspect repeating the mistakes that led up to the crisis in that they are not appropriately pricing risk, they are not appropriately pricing the risks associated with when interest rates started to return to normal.

"Around the world, interest rates are virtually at zero. This can cause lots of problems if investors take financial decisions on the basis that it's always going to be zero, which is not," he said.

Other challenges include the geo-political tension and the difficult reforms countries need to take to lift economic growth.

G20 members have agreed to achieve a 2 percent growth in the next five years. To meet the target, the G20 summit will focus on three themes as announced by Australian Prime Minister Tony Abbott. They are promoting economic growth and jobs growth by strengthening the private sector, making the global economy more resilient to future shocks, and strengthening global institutions.

Callaghan said G20 is important in strengthening international institutions such as the World Trade Organization (WTO), whose legitimacy has been greatly undermined by India's veto of WTO Trade Facilitation Agreement in July.

"G20 represents 85 percent of global GDP and 75 percent of world trade," Callaghan said, "The mere fact that countries representing 75 percent of global trade say 'we want to breathe live to the world trading system, we want to breathe live back into the WTO, we want to progress this', and they actually meant it, they send the signal back to the negotiators in Geneva, that might be quite a significant achievement."

G20 is the premium forum for international cooperation in terms of international taxation, anti-corruption, energy and even environment.

"It should focus on those. What we can do is to give political momentum into this," Callaghan said.