$ 1.1 trillion pledged by G20 to IMF and World Bank
LONDON, April 02, 2009
The World leaders who met at the G20 Summit in the British capital have pledged a whopping US $ 1.1 trillion to International Monetary Fund and World Bank to help boost the global economy and the cash strapped poor economies.
Speaking at a news conference at the close of the one-day conference in London Docklands, the British Prime Minister Gordon Brown described the current economic meltdown as the greatest challenge to the world economy in modern times.
The leaders of the world’s largest economies met Thursday to agree a global plan for economic recovery and reform under the chairmanship of the UK Prime Minister.
The objective of the London Summit was to bring the world’s biggest economies together to help restore global economic growth through enhanced international coordination.
According the Leaders statement read out by Prime Minister Brown, the summit pledged to restore confidence, growth and jobs, repair the financial system to restore lending, strengthen financial regulation to rebuild trust, fund and reform international financial institutions to overcome this crisis and prevent future ones, promote global trade and investment and reject protectism, to underpin prosperity and build an inclusive, green and sustainable recovery.
The leaders also pledged to bring world economy out of recession and prevent a crisis like this from recurring in the future.
The agreements reached by the summit participants is:
to increase resources available to the IMF to $ 750 billion,
to support a new SDR allocation of $ 250 billion
to support at least $ 100 billion of additional lending by MDBs
to ensure $ 250 billion of support for trade finance and to use the additional resources from agreed IMF gold sales for concessional finance for the poorest countries
constitute an additional $ 1.1 trillion programme of support to restore credit, growth and jobs in the world economy.
Brown further said unprecedented and concerted fiscal expansion that will save and create millions of jobs will by the end of the next year amount to $ 5 trillion, raise output by four per cent and accelerate the transition to a green economy.
*The summit also decided to reform the international financial institutions and take action against non-cooperative jurisdictions including tax havens and to deploy sanctions to protect public finances and financial systems.
*Asserting that era of banking secrecy is over, the leaders noted Organisation of Economic Co-operation and Development (OECD) has published a list of countries assessed by the Global Forum against the international standard for exchange of tax information.
*The leaders also committed to implementing the World Bank reforms agreed in October last year and also agreed that the heads and senior leadership of the international financial institutions be appointed through an open, transparent and merit-based selection processes.
*According to Brown, the leaders reaffirmed commitment made in Washington last year to refrain from raising new barriers to investment or to trade in good and services, imposing new export restrictions or implementing World Trade Organisation (WTO) inconsistent measures to stimulate exports.
Note - WTO meeting this week in Geneva
WTO General Council Meeting: October 13-14, and 19-23rd in Geneva, Switzerland.
