WASHINGTON: The world’s leading economic policymakers expressed concern about the Ukraine crisis on Saturday as they pledged once again to find ways to boost global growth through new reforms.
But little concrete came from the meeting of G20 finance ministers and central bank chiefs — and Australia’s Treasurer Joe Hockey admitted members’ growth plans are “clearly inadequate.”
And they were cautious in speaking about Ukraine, despite rising tensions within the group, which includes key antagonists Russia, on one side, and the United States and European powers on the other.
Still, their statement made it clear that they see Ukraine’s fragile economy, and the rising security threat after Moscow’s annexation of Crimea last month, as a threat to the global economy.
Much hangs on Ukraine being pulled back from the brink, including a $27 billion rescue being mounted for the country.
“We are monitoring the economic situation in Ukraine, mindful of any risks to economic and financial stability,” said the statement.
Meeting on the sidelines of the annual IMF/World Bank spring meetings in Washington, the G20 kept the focus on global growth, echoing calls by the IMF to strengthen economic expansion.
The group reiterated last year’s promise to boost collective growth by two percentage points, amid disagreement on how to do so.
But Hockey, whose country leads the G20 this year, said their individual plans for contributing to that goal, offered after they met in Australia in February, fell short of what is needed.
“The comprehensive growth strategies that were submitted by countries following the meeting in Sydney were clearly inadequate,” he told reporters.
“Some countries put forward proposals that re-heated initiatives from previous occasions, or were already announced.”
When the G20 made the commitment to enhance growth, he added, “we really meant it. It wasn’t just a rhetorical figure put in the communique for publicity purposes.”
“Instead of simply spending a lot of time reflecting ont he lessons of the past, we need to be ambitious for the future. And that’s where the two percent strategy is real.”
“We’re not going to let it just remain in the too-hard-to-achieve basket. That’s unacceptable.”
The statement identified key issues, including increasing and rebalancing demand and making exchange rates more flexible, the latter an issue regularly raised with China by the United States.
Hockey said the members were pressed to deliver more concrete growth plans by the group’s next meeting in September, in Cairns, Australia.
“Every country has to come with deliverables,” he said.
The G20 did criticize the United States over its holding up of a four-year-old reform quota program and funding increase for the International Monetary Fund.
It pressed the United States to ratify the reforms after four years of waiting, suggesting they would find an alternative if Washington does not deliver by year-end.
“We are deeply disappointed with the continued delay in progressing the IMF quota and governance reforms” agreed in 2010, the group said.
“The implementation of the 2010 reforms remains our highest priority and we urge the US to ratify these reforms at the earliest opportunity,” the group said.
The reforms, which include a funding increase and expansion of emerging economies’ roles in the IMF, were originally strongly backed by the United States, the Fund’s largest shareholder.
But implementation, which must have US support, has been held up by political battles in Congress, which needs to ratify the reforms.
Few expect US lawmakers to do that before November’s mid-term Congressional elections. But the G20 deadline allows room for the outgoing Congress to sign off on the reforms in December.
If that does not happen, an alternative could be weighed that could possibly erode the stature of the US in the Fund.