G-20 summit faces uphill battle for crisis measures

G-20 summit faces uphill battle for crisis measures
AFP
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First Published: Wed, Nov 12 2008. 03 12 PM IST
Updated: Wed, Nov 12 2008. 03 12 PM IST
Washington: With financial markets in deep turmoil, the G-20 summit this weekend faces stiff challenges to find a plan of attack to shore up the world banking system and avert future crises.
The summit of leaders of 20 major advanced and emerging economies could. And yet even that is complicated, because just two months later Bush will be replaced by President-elect Barack Obama and his Democratic administration, leaving the follow-through on summit initiatives in question.
“What he could agree to would not commit Obama, and this is a problem,” Ralph Bryant, a senior fellow at Brookings Institution said.
Bush is also hobbled by his support of the deregulation of financial markets that critics largely blame for the crisis.
The real decisions on finance system reform may have to wait for the Obama administration.
Meanwhile, international leaders are waiting to see if Obama will support increased multilateralism and greater regulation in the international financial system.
In a speech in London Monday British Prime Minister Gordon Brown urged Obama to lead a new era of US cooperation and multilateralism.
“As America stands at its own dawn of hope - so let that hope be fulfilled through a pact with the wider world to lead and shape the 21st century as the first century of a truly global society,” he said.
The International Monetary Fund (IMF) could take a leading role in rethinking the international financial regulation, as its mandate permits.
But in this transition period, the Bush administration will not take a decision, and neither will the Obama team, Bryant forecast.
“There is sympathy to strengthen supervision and regulation, but no decision will be taken right away,” he predicted.
If he has given no indication of his stance on the world economy, Obama has clearly defined his priorities at home.
“Immediately after I become president, I’m going to confront this economic crisis heahmer temple was awarded United Nations World Heritage status, rekindling a long-running disagreement over ownership of the surrounding land.
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First Published: Wed, Nov 12 2008. 03 12 PM IST
More Topics: Finance | Economy | G-20 | Market Crisis | Obama |