Divided Economic Agenda for G20 summit by Dr. Abdul Ruff

G20 World leaders will meet in London on April 2 to discuss measures to tackle the downturn. A pre-G20 meeting is being held in Horsham, in the southern English county of Sussex and Ministers from the G20 group of rich and emerging economies  joined by central bankers, are meeting in the UK to discuss stimulating their economies out of recession amid rifts over how to tackle the worst downturn in decades. The financial crisis that originally began in USA is haunting the rich nations more than the rest. There is a  consensus among the wrold leaders about a joint effort to face the economic recession the advanced world is now facing. They want to create global conditions to boost IMF.  But some European governments stress the need to change the rules governing financial markets. They aim to agree on an agenda for next month's leaders summit in London next month.

There is a consensus among the wrold leaders about a joint effort to face the economic recession. They want to create global conditions to boost IMF. The finance ministers say the present crisis cannot be solved by one country alone and want to signal they are working together to tackle the most serious economic downturn in 80 years. “Everyone must work together both to rebuild the financial sector and provide a fiscal stimulus," said Japanese Finance Minister Kaoru Yosano. The meeting also likely focuses on the need for tougher regulation of banks. Britain and France's finance ministers played down talk of a transatlantic rift on fighting the credit crisis, as they and colleagues met in Horsham, England on March 13 to prepare for next month's vital G20 summit. Ministers from the Group of 20 industrialised and emerging market countries hold talks officially ahead of a summit of world leaders including new US President Barack Obama in London on April 2.

The US is calling for increased public spending. The US , supported by Britain , wants other governments - especially those in continental Europe - to do more to bring their economies out of recession. But European governments have indicated they are unlikely to strain their finances by agreeing to much more spending until they have seen some results from the first round of stimulus programs already launched. German Chancellor Angela Merkel said that the issue was not to spend more, but to put in place a system that would help prevent similar crises in future.

While the USA, the world's biggest economy, wants a coordinated international stimulus, most of Europe is suspicious of such a move and favours tightening regulation of financial markets and institutions. In a boost for the United States, Japan and China -- the world's second and third largest economic powerhouses -- also embraced stimulus Friday. Senior US officials including Obama's top economic adviser Larry Summers have recently said leading nations must try to jumpstart a global recovery by pumping more money into their economies.

But that has not been welcomed in Europe, where many leaders do not want more spending amid big budget deficits. France and Germany have agreed to join forces to urge tighter regulation instead of more spending. Chancellor Angela Merkel said Friday: "We do not think much of the idea of a new package of measures" to underpin the economy. There was some good news for France and Germany on regulation Friday as Switzerland, Luxembourg and Austria said they would relax their sensitive bank secrecy laws, the day after similar moves by Belgium, Liechtenstein and Andorra. Monaco also intimated it would follow suit. Berlin and Paris have been leading the charge to clamp down on tax havens. French Finance Minister Christine Lagarde, arriving for the talks, said she was "very optimistic" about the meeting, stressing it was a question of finding "the best compromise between our different positions."

All the politicians come together face to face for the first time for dinner at the luxury hotel outside London where the event is being held. "I don't actually think that the divisions between the European countries and the US are anything like what has been described over the last few days," the meeting's host, British finance minister Alistair Darling, told BBC radio. "I think on both sides of the Atlantic -- and also, for that matter, in other parts of the world -- there is a commitment to ensure that we support people, support businesses and our economies."

World Bank head Robert Zoellick, who is also attending the meeting, warned that "2009 is shaping up to be a very dangerous year" for the global economy. Opening the session on 14 March, UK Chancellor Alistair Darling said he was "quite sure" progress would be made on the meeting's three main aims - supporting economies, getting bank lending going again, and making sure the whole world benefited from the action taken.  Darling - who chaired the meeting - played down talk of rifts ahead of next month's G20 summit. "Generally, each country has to decide what to do to their economies." He said people recognised that the world was facing "extraordinary circumstances". The meeting needed a commitment that no country would "hold back" from doing whatever was necessary to support their economies. "It's not just an economic necessity, but when you consider that possibly 90 million people across the world might go back into poverty, it's also a moral imperative," he added.

China and Japan, meanwhile, embraced further spending to fight the economic fire. Japan's premier Taro Aso ordered a new stimulus package worth a reported 200 billion dollars, while China's Wen Jiabao said Beijing had "adequate ammunition which means that at any time we can introduce new stimulus policies."Japan's Finance Minister Kaoru Yosano told that reviving the world economy, not regulation, must be the G20's priority. "We all agree (on the need for better regulation), but I personally feel: are these actions necessary at a time of crisis?" he said. "What we ask at this moment is to save the life of the world economy -- not to comment about its beard."

The G20 is an informal grouping of the world's most powerful countries that together represent 85% of the world's economy. It includes both major industrial powers such as the US and Germany , and emerging economic powers such as Brazil and China . The G20 countries are an extended forum of initial G7 and now has Argentina , Australia , Brazil , Canada , China , France , Germany , India , Indonesia , Italy , Japan , Mexico , Russia , Saudi Arabia , South Africa , South Korea , Turkey , the United Kingdom , the US and the EU. Brazil, Russia, India and China - known as the Bric countries - said they would not contribute extra cash unless they were given extra voting power. The IMF's voting structure means that the US and Europe have a greater say on what it does.  They argue they will only agree to increase capital to the IMF after the reform the (IMF) quotas is carried out, because there is still an imbalance in our participation in the IMF, as Brazilian Finance Minister Guido Mantega said after meeting officials from the Bric countries.

Of course, G20's priority remians advancement of capitlsaism and more profits for the big insdustiralists that could be shared by politicians amaong other bigwigs. As long as the G20 does not intiate steps activley to remove danger of global warming and help the poor nations in a big way, not by ging a few coins as aids or loans, there is very little that the world could expect form all these “high level” summits.

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Yours Sincerely,

DR. ABDUL RUFF Colachal

Columnist & Independent Researcher in World Affairs,

South Asia.