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November 23, 2019
BUSINESS

IMF: G20 meetings had “much stronger focus on growth and jobs”

The world’s leading economies set an objective on Saturday to boost growth and jobs at the end of a weekend of high-level meetings, but undermined their ambitions with sharply differing views of the necessary policies, cnn.com reports. “We’re not fully past the crisis, but by comparison to the meetings a year ago, there was a much stronger focus on growth and jobs,” said Tharman Shanmugaratnam, chairman of the International Monetary Fund’s governing body.Japan came to the meetings fearful that it would be criticised for doubling the money it plans to have in circulation, a move that has sent the yen tumbling, but its action brought few brickbats. Dropping his language that loose monetary policy was part of a “currency war” against emerging economies, Guido Mantega, Brazil’s finance minister, described Tokyo’s revitalised policy as “a new and bold program of economic growth, based on fiscal and monetary stimulus and structural reforms”. But the relatively warm reception given to Japan was a notable exception to more usual sniping from finance ministers that others are to blame to their woes and those of the global community.The US blamed Europe for the fragile demand with Jack Lew, US Treasury secretary, saying that “stronger demand in Europe is critical to global growth” in his submission to the IMF’s governing body.

Aiming his fire at China and Germany, he also argued that countries with large trade surpluses needed to more to aid global rebalancing in a stronger growth environment. “Much more needs to be done to promote effective global rebalancing, which requires stronger demand in surplus countries and continued progress toward greater exchange rate flexibility,”Lew said.Rejecting the US criticism, Wolfgang Schäuble, German finance minister, said that the risks to growth stemmed from large fiscal deficits in advanced economies such as the US. China believes that its economic strategy to reorientate its growth towards domestic consumption already meets US demands.As part of the battle over who is to blame for the weak global economic recovery, the US claimed a victory in removing hard commitments to stabilise debt from the G20 communique.

A senior Treasury official, who declined to be named, said that the statement had put much less emphasis on debt targets and this reflected the change of mood. But this interpretation was immediately challenged from European delegations, one of whom said there had been an acrimonious stand-off between the US and Germany which could not be resolved at the G20 meeting.

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