G7 pledges to continue stimulus
- Source: Global Times
- [01:09 February 08 2010]
- Comments
Finance ministers from leading industrialized nations over the weekend vowed to continue epic expenditure to bolster a fragile global recovery at the end of G7 talks in Canada's far north.
Canadian Finance Minister Jim Flaherty told a closing press conference in Iqaluit that he and his G7 counterparts "need to continue to deliver the stimulus to which we are mutually committed, and look ahead to exit strategies."
Measures to shore up the global economy have proved costly, and while the world's richest nations have promoted diverging economic and financial policies, the ministers agreed that investing in their economies remained vital in order to avoid a regression.
"We have to make sure not to undermine the global recovery," said US Treasury Secretary Timothy Geithner.
"We're absolutely committed to maintaining support for our economies until the recovery is firmly established," echoed Alistair Darling, Britain's Chancellor of the Exchequer. "We achieved a lot in 2009 ... The risk of 2010 is the world will forget just how serious the situation was and what more remains to be done."
Concern over soaring public debts, which cast doubt on the recovery and caused market turmoil in recent days, was to top the agenda but ended up being pigeonholed at the talks, which presented no new directions for the Group of Seven industrialized nations.
Greece has been placed under unprecedented EU surveillance as it attempts to implement austerity measures to slash its massive debt and a 12.7 percent public deficit, while Portugal's deficit hit 9.3 percent last year, its highest since 1974.
European Central Bank chief Jean-Claude Trichet said Thursday the high deficit and debt in some countries was placing an "additional burden" on monetary policy and undermining the bloc's stability and growth pact.
The G7 nations' combined debt has reached a whopping $30 trillion amid rabid spending to keep their economies afloat over the last year.
The euro tumbled to its lowest level Friday in almost a year.
With specific details still pending, the idea of a global tax on banks to recapture bailout costs also gained ground among officials from the rich countries' club, but they said any tax must be internationally coordinated and avoid choking off the world economic recovery.
The two-day G7 meeting kicked off Friday with dog sledding on frozen Frobisher Bay and a "fireside chat" that harkened back to its beginnings at a forest retreat south of Paris in 1975.
"This is a new start for the G7," said Flaherty, whose boss, Prime Minister Stephen Harper, will host G7 leaders in June in the Canadian wilds, ahead of a G20 summit in Toronto.
Agencies
