G20 Leaders Pledge to End Currency War
The G20 Summit in Seoul came to an end on Friday with leaders pledging to finalize specific measures to resolve the currency dispute at the next summit in France next year. Korean President Lee Myung-bak hailed progress at the summit as "remarkable" when he announced a joint statement at 4 p.m. "For now, in conclusion, [the world] is out of the so-called currency war," he said. Leaders of the G20 also agreed to reform the International Monetary Fund so that advanced countries transfer more than 6 percent of their share in the IMF to emerging countries, and work further on regulatory reform for large banks. They also agreed on proposals by Korea like support for developing countries and the creation of a global financial safety net.
"Around 170 countries that are not part of the G20 have been included in the list of developing countries subject to support," Lee said. "We must provide not only [material] support to these countries, but help them support themselves in pursuing economic growth. The G20 is not just a gathering of the 20 member countries." But no guidelines on current account balances led by the U.S., where Korea had tried to mediate, were adopted due to opposition from Germany. The guidelines, which would have capped a country's current account surplus or deficit to no more than 4 percent of GDP, will be revised by the IMF and come up for discussion again at next year's G20 Summit in Cannes, France.
The G20 Summit in Seoul came to an end on Friday with leaders pledging to finalize specific measures to resolve the currency dispute at the next summit in France next year. Korean President Lee Myung-bak hailed progress at the summit as "remarkable" when he announced a joint statement at 4 p.m. "For now, in conclusion, [the world] is out of the so-called currency war," he said. Leaders of the G20 also agreed to reform the International Monetary Fund so that advanced countries transfer more than 6 percent of their share in the IMF to emerging countries, and work further on regulatory reform for large banks. They also agreed on proposals by Korea like support for developing countries and the creation of a global financial safety net.
"Around 170 countries that are not part of the G20 have been included in the list of developing countries subject to support," Lee said. "We must provide not only [material] support to these countries, but help them support themselves in pursuing economic growth. The G20 is not just a gathering of the 20 member countries." But no guidelines on current account balances led by the U.S., where Korea had tried to mediate, were adopted due to opposition from Germany. The guidelines, which would have capped a country's current account surplus or deficit to no more than 4 percent of GDP, will be revised by the IMF and come up for discussion again at next year's G20 Summit in Cannes, France.
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