US sees growing importance of G20; wants to avoid dollar spat
AFP, London
US officials see a growing importance of the Group of 20 economic gathering and plan to use this week's Berlin forum to push pro-growth efforts, while hoping to avoid a row over the sagging dollar. The G20, which includes the Group of Seven wealthy industrialised nations and large developing countries including China and Brazil, opens a meeting Friday in Berlin of finance ministers and central bank governors. Washington views the gathering as an occasion to discuss key efforts of economic collaboration, such as debt relief for the poorest nations, reforms at the International Monetary Fund and so-called "collective action" clauses that would allow for an orderly process in case of bond defaults. "Each (G20) meeting has more and more significance as a forum for discussion," said a US Treasury official speaking to reporters ahead of US Treasury Secretary John Snow's departure for Europe for the gathering. Washington has acknowledged the need to extend economic coordination efforts beyond the G7, and played a role in inviting China to sit in at a recent G7 finance ministers meeting in Washington in acknowledgement of the growing economic clout of Beijing. And they also see a benefit to including other big emerging economies in talks. "It's a very good forum for discussing emerging market issues, the success of collective action clauses, further reforms in the IMF," the official said. "I think there will be more discussion of a proposal to reduce the debt of the poorest countries." The US delegation, headed by Snow, has been attempting to deflect criticism about the weak dollar and the big deficits blamed for the currency's slide, and instead wants to focus on economic growth initiatives. Aides to Snow argue that instead of talking about US budget and current account deficits, the focus should be on what they see as a more fundamental problem of the "growth deficit" of many US trading partners. "I think you will see a collaboration on pro-growth policies, similar to what you see in the G7," the Treasury official said. US officials hope to get an endorsement of the "Agenda for Growth" blueprint agreed upon by the G7 last year in Dubai, contending that such efforts will help remedy the global economic imbalances that have caused jitters about the dollar.
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