G20: Will Take All Action Needed to Revive Economic Growth

By Sumeet Desai | March 16, 2009

Finance chiefs from the G20 leading economies pledged on Saturday to take all necessary action to revive economic growth, fix the global financial system and fight the threat of protectionism.

Without providing many specific numbers, finance ministers and central bankers from the Group of 20 nations said all policies — fiscal and monetary, conventional and unconventional — will be used to tackle the deepest global downturn in generations.

“Our key priority now is to restore lending by tackling, where needed, problems in the financial system head on, through continued liquidity support, bank recapitalisation and dealing with impaired assets,” the G20 statement said.

“We … are prepared to take whatever action is necessary until growth is restored. We commit to fight all forms of protectionism and maintain open trade and investment,” the statement said.”We commit to fight all forms of protectionism and maintain open trade and investment.”

G20 finance chiefs, meeting in the southern England ahead of the G20 leaders’ meeting in London on April 2, reaffirmed their commitment to take “all necessary actions to ensure the soundness of systemically important institutions.”

They also said central banks will maintain expansionary policies as long as is needed and that governments’ fiscal commitments already pledged should be implemented without delay.

The G20 finance chiefs also said multilateral banks should have “all the capital they need”, starting with a “substantial” capital increase for the Asian Development Bank.

Areas of financial markets that had previously been subject to relatively light regulation will now be subject to the “appropriate degree of regulation and oversight … to prevent the build-up of systemic risk.”

(Reporting by Sumeet Desai, writing by Jamie McGeever; editing by Keith Weir)

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