G20 ministers meet amid rift
UK hosts preparatory talks for summit as members differ over ways to fight recession.
But as ministers debate how to pull the global economy out of its tailspin, tensions are likely to emerge.
Disagreement
Al Jazeera’s Tim Friend, reporting from Horsham, said: “I think everyone here would at least describe themselves as optimistic, whether that’s well founded or not is another matter. There remains a considerable point of difference between Washington and Europe about exactly how and what the tactics should be towards getting the economy back on track.”
The United States and Europe are split over the need for more aggressive stimulus or a tighter regulation on the finance sector which could help to haul countries out of the economic mire.
Larry Summers, senior economic adviser to Barack Obama, the US president, says that leading nations must try to jumpstart a global recovery by pumping more money into their economies.
That has not been welcomed in Europe, where many leaders do not want to commit to more spending because of already big budget deficits.
Jean-Claude Juncker, the Luxembourgian chairman of Eurozone finance ministers, said that US calls for more cash to be injected into the world economy “do not suit us”.
Japan and China joined the debate on Friday, saying that government spending should be the top priority.
High stakes
Failure to come up with a clear policy commitment could further hit already volatile stock markets.
Meanwhile, Alistair Darling, Britain’s finance minister, tried to play down the disagreements between G20 member states.
“I think on both sides of the Atlantic – and also, for that matter, in other parts of the world – there is a commitment to ensure that we support people, support businesses and our economies.”
While the recent exchanges from the world’s richest countries could suggest real differences, they face their worst recessions for decades amid shrinking consumer demand.
Robert Zoellick, the World Bank president, warned that 2009 was turning into a “very dangerous year” for the global economy.
He said that any new stimulus plans would be “like a sugar high unless you fix the banking system”.