G20 will use “all tools” to boost growth – publico

                 

                         
                     

                 

 
 

More words than action. The G20 countries have said they will use all the tools available to counter the cooling trend of the global economy, and that alone, the monetary policies of central banks are not enough – but have no agreed position on that specific measures apply <. / span>

“We agreed to use all the tools – monetary, fiscal and structural – to boost growth”, said on Saturday the Chinese Finance Minister Lou Jiwei, a press conference held after a meeting which met in Shanghai, the heads of finance of the 20 largest world economies, as well as the governors of the central banks.

the official communiqué issued by the G20 argues that there is an ongoing economic recovery, but a pace that is not enough for sustained growth:. “the global recovery continues but remains uneven and falls short of our ambition for a strong, sustainable and balanced growth”

it was expected that the meeting of the G20 in Shanghai – the highest level following the bringing together the leaders of these countries – did not result in any global stimulus plan. On Friday, statements of some leaders have made clear the existence of different views, with Germany to refuse the hypothesis one fiscal stimulus package, which would pass through an increase in public expenditure and, consequently, the indebtedness of countries. “The growth model based on debt financing reached the limit,” said German Finance Minister Wolfgang Schäuble, saying not accept a “package of fiscal measures of the G20, as some propose.” The French Michel Sapin said for his part that his country is not able to move forward on this path and others with greater capacity should do so -. A reference to Germany, which registered last year a record budget surplus

the G20 meeting was held with the backdrop of multiple risks for the world economy: the slowdown in Chinese growth to the lowest level of the last quarter century, the cooling of other emerging economies (including the Brazil , grappling with a financial crisis and political), the fall in world trade and the price of raw materials, with the expectation that the global oil supply continues to exceed demand at least throughout this year and next.

the official statement also points out the risk “of escalating geopolitical tensions” and the “growing number of refugees in some regions” as well as “the shock of a potential output of the United Kingdom of the European Union.” According to the Financial Times and Reuters, the reference to a possible UK output was absent from earlier drafts and was included in the final version of the document under pressure from British representatives. The continuity of the country in the bloc will be endorsed in June and Prime Minister David Cameron, and the majority of its Government, are in favor of permanence.

The policies of central banks were also in up the discussion table. The idea of ​​an agreement similar to the 1985 (which then devalued the dollar against other currencies) has emerged in the media coverage of the meeting, but the charge dismissed from the outset any chance of a similar pact. The official statement said that monetary policies that have been carried out by central banks – which in Europe include negative interest rates and asset purchase programs to inject money into the economy – will continue “to support economic activity and ensure stability price “, although it is argued that” alone can not lead to balanced growth. “

it seems, however, be an understanding to avoid a currency war with countries to devalue the currency as a tool competitiveness for their exporters. “If political decisions – for example, on domestic issues – lead to devaluation, we must inform and consult the different countries,” he said, quoted by Bloomberg, the Minister of Dutch Finance, and President of the Eurogroup, Jeroen Dijsselbloem

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