NVDA Q3 Earnings Alert: Why our AI stock picker is still holding Nvidia stockRead More

FACTBOX-Major issues at G7 meeting in Canada

Published 02/06/2010, 07:56 PM
Updated 02/06/2010, 07:57 PM

Feb 6 (Reuters) - Finance ministers and central bankers from the Group of Seven economies met in the Canadian Arctic to discuss the euro zone's budget crisis, the recovery from global recession and reforms of international banking.

Below is a summary of the outcome of the two days of talks that ended on Saturday, based on comments from G7 officials:

EURO ZONE FISCAL CRISIS

The collapse in confidence among investors about Greece's ability to pay its debts, and knock-on concerns about Portugal and Spain, pushed the euro zone's fiscal crisis onto the agenda of the G7 meeting.

European G7 countries told the United States, Japan and Canada that they would make sure that Greece delivered on its promises to slash its budget deficit by the end of 2012.

"Will we will monitor and make sure it (the Greek plan) is managed," French Economy Minister Christine Lagarde said.

FINANCIAL REGULATION

Last September, world leaders asked the International Monetary Fund to come up with proposals for a levy on banks to help pay for financial rescues and in Canada this weekend ministers roundly supported the idea.

The Obama administration was seen as cool to the idea last year but it has since taken a tougher approach to banking regulation, mindful of the anger among voters at huge bonuses on Wall Street soon after its rescue with taxpayers' money.

GLOBAL RECOVERY, EXIT STRATEGIES

The G7's host, Canadian Finance Minister Jim Flaherty, said the global economy was recovering but was still too weak for governments to withdraw stimulus measures.

In an apparent nod to concerns about huge budget deficits run by countries like the United States to keep their economies going, he said governments were starting to look at scaling back their support and returning to fiscal health.

CURRENCIES

The G7 made no comment on foreign exchange, but ministers said the group stood by its statement of last October.

That communique politely welcomed China's decision to allow its currency to strengthen and said that should help narrow the imbalances in the world economy that, many say, sowed the seeds of the financial crisis of 2008.

France's Lagarde said under the new, more informal format of the G7 meetings, the group had decided to issue statements on currencies only when it had something new to say.

G7 members appear split on what is the best forum to discuss foreign exchange policy with some European members, like France, favoring the G7 and Japan suggesting that discussions on China's yuan, for example, could take place in the wider Group of 20 developed and emerging economies, of which China is a member.

FUTURE OF THE G7

The G7 is expected to continue to meet as often as it deems necessary, and several officials said they liked the no-nonsense, informal format of the Iqaluit talks, which allowed them to speak their minds openly and freed them from long hours negotiating over the language of a communique.

"Open speech, not working out communiques, that is the meaning of the new G7," said German Finance Minister Wolfgang Schaeuble.

The next G7 finance ministers' meeting will be on the sidelines of the International Monetary Fund's spring meetings in Washington, Canada announced.

HELPING HAITI

Canada said the G7 countries were writing off debts owed to them by disaster-struck Haiti and urged global lenders to do the same. Few delegates mentioned the Caribbean island where more than 200,000 people died in a Jan. 12 earthquake.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.