G20 pledge 'ambitious' steps to spur growth, jobs

The Group of 20 economic powers pledged Friday "ambitious" steps to spur growth and job creation to get the crisis-scarred global economy back on track. The financial leaders of the world's biggest economies, after talks in Washington, said the major crises had been overcome but growth was "too weak" and unemployment "too high." The G20 "reaffirmed our determination to raise growth and create jobs," the group said in a statement following their meeting on the sidelines of the International Monetary Fund and World Bank spring meetings. They said the global economy was held back by uncertain government policies, still-heavy private and public debt loads, impaired bank lending, and "incomplete rebalancing" of global demand -- a push on surplus G20 member economies like Germany and China to stimulate more local demand. "We have agreed that while progress has been made, further actions are required to make growth strong, sustainable and balanced," said the group, which accounts for 90 percent global output. "We will continue to implement ambitious structural reforms to increase our growth potential and create jobs." Among the steps needed is the strengthening the eurozone's economic and monetary, "including through an urgent movement towards banking union" and bolstering bank's balance sheets. The United States should make more progress on a medium-term budget plan but "significant deficit reduction" in the world's largest economy already has been achieved, the G20 finance ministers and central bank governors said. The finance chiefs gave a cautious endorsement of Japan's huge monetary stimulus program, agreeing it was necessary to boost the country's stagnant economy. Japan's latest policy actions "are intended to stop deflation and support domestic demand," they said. A senior US Treasury official, speaking on condition of anonymity, said that Japanese officials had stressed how the monetary moves would lift demand in the world's third-largest economy, which has been struggling for two decades. That came as many countries, including the United States, have expressed concern that Japan could be deliberately trying to force the yen lower to boost exports and cut imports via "competitive devaluation." But the G20 called for more efforts to stimulate "strong, sustainable and balanced" growth globally, and took note of Japan's effort towards that. "The latest decision on quantitative easing remedies the situation that was building up for years," said Russian Finance Minister Anton Siluanov, chair of the G20 meeting, at a news conference. At the same time, the group pledged not to compete on the currency front. "We will refrain from competitive devaluation and will not target our exchange rates for competitive purposes, and we will resist all forms of protectionism and keep our markets open," they said in a statement. Siluanov, whose country Russia currently holds the G20 presidency, said there was strong debate on a framework agreement on deficit and debt targets. "We all agreed there's no need to set hard targets," he said, but medium-term "soft" parameters could be set. Members had agreed to weigh that at the next G20 summit, in July. But the G20 also urged the United States and Japan, both undertaking strong efforts to expand domestic demand, to quickly fashion "credible" medium-term plans for reeling in their huge debt and deficit loads. The group called for the global adoption of standards for sharing bank account information in an effort to fight tax evasion and curtail banking secrecy. The G20 said they "strongly encourage" all countries to sign on to a commitment to the automatic exchange of banking information "which is expected to be the standard," in the group's strongest endorsement yet of a move that takes aim especially at tax havens like Switzerland. "More needs to be done to address the issues of international tax avoidance and evasion, in particular through tax havens, as well as non-cooperative jurisdictions," it said. It urged all countries to accept the Multilateral Convention on Mutual Administrative Assistance in Tax Matters, a framework for the sharing of banking data.