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14 Mar, 2009 19:19

G20 Finance ministers demand reforms and fight protectionism

At a meeting in southern England, financial policymakers from the G20 group pledged to increase the role of the International Monetary Fund and make a “sustained effort” to restore global growth.

The meeting of G20 finance ministers prior to the April summit of heads of state, took place amid reports of a rift between the US and European group members over the necessary measures.

In a statement released after the talks, restoring frozen bank lending through cash infusions and dealing with the shaky assets souring bank's balance sheets were labeled as top priorities.

“We have taken decisive and comprehensive actions to boost demand and jobs and importantly we stated that we're prepared to take whatever action is necessary to ensure that growth is restored, and we have committed to do that for however long it takes,” British Chancellor Alistair Darling said at a news conference.

Europe's largest economies are demanding regulatory reforms to the financial system, rather than increased public spending and more stimulus plans as suggested by the US.

The ministers also committed themselves to fighting protectionism and pledged to help emerging and developing economies that suffer the loss of international capital flows.

Meanwhile, the BRIC developing economies at the meeting – Brazil, Russia, China and India – have called on Europe and the U.S. to disclose more information on the state of their economies.

In a joint communiqué, the four have also called for a larger role in the International Monetary Fund.

“We have the desire to accelerate reform of the international financial architecture,”
said Alexey Kudrin, Russia’s Finance Minister. “BRIC countries are ready for more challenging decisions than those we can expect from other countries.”

Meanwhile, U.K. Prime Minister Gordon Brown said that he held talks during a long walk in the southern English countryside with German chancellor Angela Merkel.

Despite Merkel dismissing calls for a new EU fiscal stimulus package, the leaders promised next month's summit will bring each country's financial regulations in line with each other.