G8 leaders said on Saturday it is “their imperative” to promote growth and jobs to reinvigorate the global economy, and gave their backing to Greece remaining in the eurozone.
“We agree on the importance of a strong and cohesive Eurozone for global stability and recovery, and we affirm our interest in Greece remaining in the eurozone while respecting its commitments,” the leaders said in a ommunique after meeting at Camp David.
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Greece’s possible exit from the eurozone was high on the agenda, following inconclusive elections there.
US President Barack Obama has said the G8 was committed to growth, stability and fiscal consolidation, as leaders tried to bridge divisions on how to deal with the deepening eurozone crisis.
Flanked by leaders of the G8 industrialized nations on Saturday, Obama indicated a balanced approach was needed as “part of an overall package that all of us have to pursue in order to achieve the kind of prosperity for our citizens that we’re looking for”.
With the future of Europe’s currency union in serious doubt, leaders gathered at Obama’s Camp David lodge to weigh competing demands for growth-friendly spending with Germany’s long-standing focus on sharp spending cuts.
The drive could upend two years of Berlin-led austerity-first policies, which critics say have fuelled rampant unemployment, brought Greece to the verge of bankruptcy and deepened crises in Italy and Spain.
After an early morning bilateral meeting with Obama, British Prime Minister David Cameron said he detected a “growing sense of urgency that action needs to be taken” on the eurozone crisis.
“Contingency plans need to be put in place and the strengthening of banks, governance, firewalls – all of those things need to take place very fast,” he told reporters.
He said Merkel was “absolutely right” that every country needs to have in place strong plans for dealing with their deficits.
Answering a reporter’s question during a group photo later, Obama said there was “more work to do” before any decisions on the eurozone were reached.
Hours before welcoming the participants, Obama had met his French counterpart, Hollande, and threw his weight behind France’s demand for pro-growth policies in Europe.
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Obama said the two agreed that tackling the eurozone crisis was “an issue of extraordinary importance, not only to
the people of Europe, but also to the world economy”.
“We’re looking forward to a fruitful discussion later this evening and tomorrow with the other G8 leaders about how we can manage a responsible approach to fiscal consolidation that is coupled with a strong growth agenda,” he said.
Al Jazeera’s Patty Culhane, reporting from Washington, said: “This is such as an interconnected economy, that problems in Europe can affect the USA as well, and as it is an election year it is important for Barack Obama to ensure Europe sorts it out.”
Hollande, who was elected just two weeks ago, said growth must be the priority, maintaining his stance that austerity measures alone would be insufficient to reverse the crisis in Europe.
Hollande also met Cameron on Friday.
“We’ve discussed the economic challenges that we face and we both want to see stability in international markets,” said Cameron. “We both want to see countries deal with their deficits and we both want to see economic growth.”
The G8 club of developed nations consists of the United States, Britain, Canada, France, Germany, Italy, Japan and Russia.
The two-day G8 meeting also addressed Iran’s nuclear programme.
“We’re unified when it comes to our approach with Iran,” Obama said, adding that weaponisation of the programme was “something of grave concern to all of us.”
Also on the agenda are Syria’s uprising, fears that North Korea will conduct a new nuclear test, and Myanmar, after Obama eased US investment restrictions on the country on Thursday.
The G8 summit precedes a meeting og NATO leaders in Chicago on Sunday which is expected to focus on the international alliance’s plans to withdraw from Afghanistan by the end of 2014. Both Afghan President Hamid Karzai and Pakistani counterpart Asif Zardari will attend those talks.