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04/11
G-20 Ministers Say Global Economic Recovery Is `Uneven,’ Still Faces Risks
Group of 20 finance officials said the global economic recovery remains “uneven” and imbalances risk hurting growth without further efforts to coordinate policies.
The recovery “is strengthening but is still uneven and downside risks remain,” G-20 finance ministers and central bankers said in a statement after a meeting in Paris today. “We reaffirm our willingness to ensure a consistent and coordinated response to the challenges we face, address the root causes of the crisis and restore global economic growth on a sounder basis.”
Disparities in growth between emerging economies like China and debt-laden regions like the U.S. and some European nations are fueling clashes over policies needed to erase global imbalances and sustain the recovery. The U.S. and other developed economies are pushing China to allow its currency to appreciate to help counter global imbalances.
Governments of emerging economies including China have said that the U.S. and European monetary policy is flooding their economies with capital, threatening to inflate asset bubbles. China has rejected policy prescriptions that fault its exchange- rate regime and policy of accumulating reserves.
“Some conditions have to be met before the Chinese currency is ready,” German Finance Minister Wolfgang Schaeuble told reporters in Paris today. “The Chinese know this. This is a process that has started. This goal won’t be reached this year.”
China will remain the world’s fastest-growing major economy in 2011, with a 9.6 percent expansion, the International Monetary Fund forecast last month. The Washington-based lender projects growth of 3 percent in the U.S. this year and 1.5 percent in the 17-nation euro area.
“Most people see a world in which the emerging world’s growing 5 percent, 6 percent — we’re growing between 3 percent and 4 percent, Europe and Japan somewhere between 1 percent and 2 percent,” U.S. Treasury Secretary Timothy F. Geithner said in Paris yesterday. “That seems a reasonable forecast.”
To contact the reporter on this story: Theophilos Argitis in Paris at targitis@bloomberg.net
To contact the editor responsible for this story: James Hertling at jhertling@bloomberg.net