G20 economic plan 'underwhelming'
Agence France-Presse
November 17, 2008 09:20am
Faced with the most severe economic downturn in decades, the summit held Saturday by the Group of 20, which groups 19 countries and the European Union, called for a range of new regulations of financial institutions.
The group also insisted that large developing economies such as Brazil and China be given more say in the operation of global finance institutions such as the International Monetary Fund, which have been dominated by industrial nations.
The leaders also vowed to use government spending to reverse a spreading recession, to press for a global trade deal to ward off protectionism and to reform financial regulation and world financial institutions.
But world media was underwhelmed at best, an in some case expressed cynicism.
"Summit of lies,'' headlined La Repubblica, the left-wing Italian newspaper.
"The only clear signal from this G20 was the acceleration of the birth of a new world order,'' it said, highlighting that only Saudi Arabia and China had the financial reserves to take part in a relaunch of the International Monetary Fund.
El Pais of Spain called the summit declaration a "modest'' first step to reforming international finance, while the British newspaper The Observer said that no leader at the summit "has a plan to tame the wild capital flows that have distorted the global system in the last few years.''
The Group of 20 leaders said after the summit on Saturday said they were "determined to enhance our cooperation and work together to restore global growth and achieve needed reforms in the world's financial systems.''
Spain's centre-left El Pais said that the Washington summit, although necessary had been a "modest'' first step "to reforming the world financial architecture.''
It described the summit final statement as "serious and urgent'' but added that it proposed only "generic principles to reform the financial system and very general lines of economic action.''
Japan's conservative Sankei Shimbun newspaper also expressed a pessimistic view in a commentary on its Internet edition titled, "Japan lacks next moves.''
"There is a growing concern that Japan may become isolated in the world if it fails to take coordinated financial and monetary actions,'' it said.
Meanwhile, many Indian dailies said the final statement reflected New Delhi's concerns and increased influence, while hailing its success in persuading the World Bank to hike funding to India from the existing $US3 billion ($4.7 billion) to $US9 billion.
Over all, emerging economies wielded new-found influence at a financial crisis summit of major world nations that ended here Saturday, boosted by economic growth at home that contrasted with the deepening recession plaguing developed nations.
Countries such as China, Brazil, India and Indonesia not only won key seats at the global decision-making table reserved in the past for a few industrialized nations but also extracted concessions from the rich economies in efforts to ward off financial turmoil.
"I leave Washington very happy because the world's geo-political structure has a new dimension,'' Brazilian President Luiz Inacio Lula da Silva told reporters as he headed home after the G20 summit aimed at confronting a global financial meltdown.
"There is no logic to making any political and economic decisions without the G20 members -- developing countries must be part of the solution to the global financial crisis,'' he said.
Brazil currently holds the rotating leadership of the G20, which consists of the Group of Seven major industrialised countries - Britain, Canada, France, Germany, Italy, Japan and the United States - and Argentina, Australia, Brazil, China, India, Indonesia, South Korea, Mexico, Russia, Saudi Arabia, South Africa, Turkey and the European Union.
