LECCE, Italy, June 13 (Reuters) - Following is a draft statement, obtained by Reuters, from the Group of Eight finance ministers' meeting in southern Italy.
The meeting is to end later in the day, when an official communique will be released.
1. We, the G8 Finance Ministers, remain focused on addressing the ongoing global economic and financial crisis. We have taken forceful and coordinated action to stabilize the financial sector and provide stimulus to restore economic growth and there are increased signs of stabilization in our economies, including a recovery of stock markets, a decline in interest rate spreads, improved business and consumer confidence, and encouraging figures in the manufacturing sector.
Yet, we must remain vigilant to ensure that consumer and investor confidence is fully restored and that growth is underpinned by stable financial markets and strong fundamentals.
We will take all necessary steps to put the global economy on a strong and stable growth path, including by continuing to provide macroeconomic stimulus consistent with price stability and medium-term fiscal sustainability, and addressing liquidity and capital needs of banks, as necessary.
We reaffirm our commitment to take all necessary actions to ensure the soundness of systemically important institutions.
While the economic outlook is improving, the situation remains uncertain. Moreover, unemployment may continue to increase even after output growth begins picking up. We agreed that our countries continue to take coherent actions to reduce the impact of the crisis on employment and maximise the potential for growth in jobs in the period of economic recovery, including by promoting targeted active labor market policies, enhancing skills development, ensuring effective social protection systems and enabling labor markets to respond to broader structural changes.
We discussed the appropriate framework for unwinding the extraordinary policy measures taken to respond to the crisis once the recovery is assured. These "exit strategies" will vary from country to country depending on domestic economic conditions and public finances; however close international cooperation will foster continued economic and financial stability, ensure a level playing field and promote a sustainable recovery over the long term.
We have asked the IMF to undertake the necessary analytical work to assist us with this process. Effective communication through transparent policy frameworks will be essential.
While the stabilization of the economy over the short term is critical, we also discussed other challenges ahead of us. The crisis has revealed that there are some fundamental weaknesses in the global economy related to propriety, integrity and transparency. To address these issues in a comprehensive fashion, we have agreed on the need to develop the Lecce Framework - a set of common principles and standards governing the conduct of international business and finance - which builds on existing initiatives and lays the foundation for a stable growth path over the long term (see the attached annex for details).
We are committed to working with our international partners to make progress with this initiative, with a view to reaching out to broader fora, including the G20 and beyond.
We discussed regulatory reform in our countries and at the international level. We are swiftly implementing the commitments made at the Washington and London Summits and call other jurisdictions to join our efforts to ensure global financial stability and an international level playing field.
We urge the relevant international institutions to closely monitor the implementation of these decisions and we encourage them to develop a toolbox of measures to promote the adherence to internationally-agreed supervisory and prudential standards by the jurisdictions that do not comply with them.
We welcome progress in negotiations of agreements on the exchange of information for tax purposes. We stress the need for countries and jurisdictions that have not yet substantially implemented the OECD standards to rapidly turn their commitments into effective action and demonstrate their enduring engagement by concluding and implementing an ever larger number of agreements according to the relevant international standards.
We strongly support the involvement of the widest possible number of countries and jurisdictions in a peer-review mechanism to assess compliance with the same standards, and the broadening of the process to involve developing countries. Further to the request by our Leaders at the 2008 Hokkaido G8 Summit, we look forward to an OECD report by 2010.
We also look forward to an update on progress on the G20 agreement to tackle tax havens at the OECD Ministerial on 24-25 June.
We welcome FATF engagement with the G20 to fight against money laundering and the financing of terrorism. We are also committed to working with FATF on improving international standards and their global implementation, including preparation for the next round of mutual evaluations, promoting international cooperation and reinforcing actions on jurisdictions with vulnerabilities.
FATF should report back on its actions by September. In particular, we underscore the importance of FATF Statements that outline money laundering and terrorist financing vulnerabilities to the global financial system, and endorse the FATF's call for countries to implement counter-measures against Iran and protect the financial system from illicit financing.
To facilitate the recovery and sustain growth over the longer term, we reaffirm our commitment to refrain from protectionism and we commit to continue working towards an ambitious conclusion of the Doha round.
The rapid implementation of the trade finance support announced in April in London is essential in restoring international trade flows, particularly to emerging and developing countries.
We have led efforts to provide the IMF with the necessary resources to expand its lending capacity and are fully committed to swiftly implement the London and Washington Summit commitments, and urge other countries to participate.
We are also exploring ways to double the IMF capacity for concessional lending through the sale of gold or other means, and we encourage the Fund to explore the scope for increased concessionality to low-income countries. We remain committed to reforming the IMF to enable it to carry out its critical role in the modern global economy. We welcome the actions taken by the World Bank and other Multilateral Development Banks (MDBs) that highlight their important countercyclical role in responding to the global crisis.