Following up on the previous weeks meeting of finance officials in Sao Paolo, G20 leaders (including 10 major emerging economies+ G8, Australia and the EU) meeting in Washington agreed to continue to take steps to stabilize the global financial system and improve the international regulatory framework.
Action plan includes regulatory policy changes to be implemented by March 31, 2009 and G20 agrees to meet again before April 30, 2009
- Against this background of deteriorating economic conditions worldwide, ... a broader policy response is needed, based on closer macroeconomic cooperation, to restore growth, avoid negative spillovers and support emerging market economies and developing countries.
- Further policy steps to include Monetary policy support as appropriate for domestic conditions, fiscal measures to stimulate domestic demand, while maintaining a policy framework conducive to fiscal sustainability.
- Increased transparency of financial sector, reguiation of rating agencies, avoiding pro-cyclical regulation, increased information sharing between national authorities, expanding the FSF to include emerging economies and ensuring that IMF and other multilateral institutions to have sufficient resources to support emerging economies capital needs.
Describing the G-20 summit as "very successful", Prime Minister Manmohan Singh on Sunday said that this had marked a shift in balance of economic power in favour of emerging economies.
One should not expect even a new monetary system to put the U.S. or the global economy back on track toward the high rates of real growth that we’ve seen over the last several years. That’s simply not going to happen. But this is at least a right & fundamental approach to solve this problem.