Not that the 20 presidents or prime ministers did not have plans to tackle the crisis, but because the host country, the world’s undisputed leader since WWII, did not have a clear leader to take charge-President Bush is leaving office in 60 days and it is unconstitutional for president-elect Barack Obama to step in before Bush leaves. So the world’s worst financial crisis in 80 years must wait. It is forecast that real recovery won’t come before 2010. The Europeans got “virtually everything” they sought at the summit, according to French President Nicholas Sarkozy. He said it had been difficult to persuade Bush to call the summit, but the results were worth it. “America is still the No. 1 power in the world,” he noted. “Is it the only one? No, it isn’t.” Time is running out to stem the economic damage from credit market turmoil that began about 17 months ago. The Group of Seven — the U.S., Britain, France, Germany, Japan, Canada and Italy — or the G-7 plus Russia, known as the G-8, usually would handle global economic problems. The G-20, of the developed and developing countries, folds the G-8 into a larger group that includes emerging economies — China, India, Brazil, Saudi Arabia, Indonesia and South Africa among them. The next G-20 summit is scheduled for April 30 in London. The 11-page communique of the G-20 summit spoke of broad principles, leaving the details to be worked out after Obama is sworn in on January 20.

According to the joint statement, countries such as China, Brazil and India would gain greater roles and responsibilities as part of a restructuring of the international financial system, while European leaders won a commitment to new regulations and controls on banks, rating agencies and exotic financial securities.

The leaders also agreed that a dramatic failure of market oversight in “some advanced countries” was among the root causes of the financial crisis, an implicit rebuke of the United States. China, South Korea and Japan are considering steps including currency swaps, which would strengthen their regional defenses against the global financial upheaval.

The final communique was significant in what it did not include. There was no mention of the creation of a global financial market enforcer as demanded by emerging countries but opposed by the U.S.

Subscribe to The China Post and save.  Click here

SharePrintEmail

Write a Comment

Enter your comments - 1000 characters max

Type in image code

Submit

 Receive China Post promos Respond to this email