G-20 hails global recovery amid Greece`s debt crisis+

WASHINGTON, April 24 Kyodo -
Financial chieftains of the Group of 20 advanced and emerging nations said
Friday the world economy is recovering despite Greece's debt crisis, but the
pace of the recovery varies depending on regions.
''The global recovery has progressed better than previously anticipated largely
due to the G-20's unprecedented and concerted policy effort,'' they said in a
joint communique released after their one-day meeting in Washington. ''However,
it is proceeding at different speeds within and across regions.''
Noting that unemployment remains high in many countries, the G-20 finance
ministers and central bankers pointed out the need to put their fiscal houses
back in order, which have sharply deteriorated due to the massive stimulus
measures taken to combat the global downturn.
''We should all elaborate credible exit strategies from extraordinary
macroeconomic and financial support measures that are tailored to individual
country circumstances,'' they said.
''In economies where growth is still highly dependent on policy support and
consistent with sustainable public finances, it should be maintained until the
recovery is firmly driven by the private sector and becomes more entrenched,''
they said.
The G-20 gathering was overshadowed by Greece's debt woes, which highlighted
the danger of fiscal problems. But the communique made no mention of Greece, as
Athens on Thursday asked for a rescue package put together by the European
Union and the International Monetary Fund to be activated.
Naoto Kan, the finance minister of Japan whose state debt is approaching 200
percent of gross domestic product, the worst among the industrialized world,
said at a press conference after the G-20 parley that Japan's stance is to
cheer the efforts of the EU and the IMF to help Greece, and that Japan should
learn a lesson from Greece.
''I told (my G-20 colleagues) that we intend to progress discussions (on fiscal
reform) in a bipartisan way,'' Kan said. ''It should be necessary to seek both
-- growth and fiscal rehabilitation.''
U.S. Treasury Secretary Timothy Geithner said separately the United States,
whose fiscal deficit is also swelling after implementing massive stimulus
measures to cope with the global financial crisis, will begin to cut fiscal
deficits from 2011.
The G-20 financial leaders reiterated the need to rebalance global economic
growth, urging some countries to spur domestic demand instead of depending too
much on exports.
However, there was no mention in the communique of China, whose massive
surpluses are at the heart of the global imbalances, together with huge debt
burdens on rich nations, particularly the United States.
Kan said no talks were held about China's yuan at the G-20 gathering, noting
that ''everyone knows China does not favor (its currency) being discussed'' on
such an occasion.
On other issues, the G-20 financial leaders confirmed that progress has been
made on financial regulatory reforms and called on the IMF to further study the
proposed global bank tax, a topic that divided the G-20 nations at the meeting.
''We call on the IMF for further work on options to ensure domestic financial
institutions bear the burden of any extraordinary government interventions
where they occur, address their excessive risk taking and help promote a level
playing field,'' they said.
The financial chiefs also agreed to bring forward the date for a final
agreement on the issue of IMF governance reform to give greater say to emerging
economies in decision-making at the Washington-based lender to November from
the original deadline of January next year.
The IMF policy-guiding panel has been tasked to complete the shift in IMF
voting rights to emerging and developing economies of at least 5 percent to
better reflect their rising economic power.
The G-20, which evolved into the ''premier'' global economic forum last
September, consists of the Group of Seven major industrialized countries --
Britain, Canada, France, Germany, Italy, Japan and the United States -- and
emerging powerhouses such as Brazil, China, India and Russia.
From Japan, Kan and Bank of Japan Governor Masaaki Shirakawa attended the G-20
gathering, which will be followed by the IMF and World Bank meetings on the
weekend.
The G-20 financial chiefs agreed to meet again on June 4-5 in Busan, South
Korea, to prepare for the leaders summit in Toronto, Canada later that month.
They are tasked with putting forward a set of recommendations for a planned
peer review to attain a ''strong, sustainable, and balanced'' economy.
==Kyodo