(UKPA) – 1 hour ago
The G20 is to
take on an expanded role as part of a historic shift that
recognises the rising influence of China, Brazil and
India.
The leaders of
the world's top 20 wealthy and developing nations decided that the
G20 will take over the role of preeminent council on global
economic cooperation, a function that for more than three decades
had been performed by a smaller club of leading industrial
countries known as the G8.
The G8 will continue to meet on matters of common importance
such as national security.
Despite protests on the streets the atmosphere of the summit is
a lot more relaxed than at the fear-driven sessions in Washington
last November and in London in April. Still, the global recovery
remains fragile, with many big financial institutions under
strain.
US Treasury Secretary Timothy Geithner predicted that summit
partners would endorse the broad outlines of a proposal to deal
with huge imbalances in the global economy - such as large trade
surpluses in China and record budget deficits in the US. He said
other countries also seemed willing to scale back subsidies
supporting fossil fuels that aggravate global warming.
At a news conference, Mr Geithner also said the US supports
China's efforts to gain greater voting rights in the International
Monetary Fund over the reservations of European nations, who would
lose influence.
Given the rise of China's economic powers, "it's the right
thing," and Europe recognises that, Mr Geithner said at the start
of talks among the world's top 20 wealthy and developing nations.
The G20 leaders gathered with their spouses for a welcoming
reception at a botanical reserve, and then they parted for separate
banquets.
Throughout the day, world leaders descended on the comeback city
of Pittsburgh to debate how to keep a fragile global recovery
going. Mr Geithner said the G20 countries had reached a consensus
on the "basic outline" of a proposal to limit bankers' compensation
by the end of this year. He said it would involve setting separate
standards in each of the countries and would be overseen by the
Financial Stability Board, an international group of central
bankers and regulators.
Until now, European countries had pressed harder than the US for
limits. "Europeans are horrified by banks, some reliant on
taxpayers' money, once again paying exorbitant bonuses," said
European Commission President Jose Manuel Barroso. But Mr Geithner
predicted the proposed crackdown on bankers' bonuses would be in
place by the end of the year.
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