Berlin Summit: "Coordinated Action To Tackle the Economic Downturn"
22/02/09
The meeting in Berlin on 22 February -- attended by the G20's European member states, the European Commission, the European Central Bank and the Eurogroup -- offered the participants an opportunity to discuss the most urgent measures required to tackle the economic downturn and the credit crunch, ahead of the G20 Summit in London
There is also a very strong need right now for close coordination between the agendas of the G20 and the G8 under Italy's presidency. The trend is to focus on structural reforms and public investments in an international situation that is still tense.
Speaking at a news conference, German Chancellor Angela Merkel stressed the need for "shared principles in the world, including the need to address major imbalances among the world's economies". "London," she added, "will be a first step, then the G8 Summit in Italy will be a second step, in thrashing out a charter for these shared principles in the future".
Italian Prime Minister Silvio Berlusconi stressed in his speech at the final news conference that there is "full agreement" among the European members of the G20 group "on acting in a coordinated fashion" to address the crisis, and on "rewriting the standard global ground rules that apply to everyone". And in an interview in today's edition of German daily Bild, the Italian Prime Minister returned to dwell on the issue of coordination between the G8 and the G20: "At the G20 we will be discussing the direct technical solutions that need to be adopted; while at the G8 Summit on the island of La Maddalena, our task will be to propose political and regulatory mechanisms to combat the causes that triggered the crisis, to make sure that it does not happen again".
In the interview, Prime Minister Berlusconi illustrated some of the measures on which the G8 summit on La Maddalena is going to have to reach a decision: "Under Italy's leadership, the G8 will be proposing Detax, which is a tax mechanism that earmarks a certain percentage of tax revenue for developing countries". The prime minister explained: "We have to combat the crisis and to work for recovery, but we also have to concern ourselves with reducing the imbalances that exist in the world. To do that, Italy has proposed opening up the G8 to the emerging economies so that it can become more inclusive and representative, yet without losing its effectiveness".
At the meeting in Berlin, all of the heads of state and government leaders present agreed in full on a number of crucial issues. British Prime Minister Gordon Brown argued that "the top priority now is to concern ourselves with European citizens' jobs". And the final communiqué contained several other important considerations: "We have highlighted our belief that all financial markets, products and players must be subject to appropriate oversight or regulation, without any exceptions in respect of their country, including 'hedge funds' which can represent a risk for the system". The response to failure to comply with the rules may stretch to stiff sanctions, especially for "tax havens".
The Italian Prime Minister clarified the intentions that emerged in the course of the meeting even further: "Our agreement is total. We have to act in a coordinated manner; we have to repeal the old rules of the past and rewrite 'global legal standards', new rules that apply to everyone. And we must not let ourselves fall into the temptation of protectionism". The recent meeting of G7 finance ministers and central bank governors in Rome on 13 and 14 February, which kicked off the round of ministerial meetings in Italy's G8 Presidency year, also came out in favor of the need to promote a legal standard.
Lastly, it has been announced that the leaders of the European institutions may be holding a meeting with newly elected US President Barack Obama, in all likelihood before the G20 Summit in April.
Photo: REGIERUNGonline/Kühler - German Government website
