G-20 Calls for Concerted Efforts on Exit Strategy
By Yoon Ja-young
Staff Reporter
Vice finance ministers and central bank deputy governors of G-20 countries agreed that a concerted global effort is needed regarding exit strategies.
At the G-20 Finance and Central Bank Deputies' Meeting held in Incheon on Feb. 27 and 28, delegates agreed that the global economy has entered a recovery.
The meeting was attended by 150 delegates from G-20 member countries and seven international organizations, including the IMF, World Bank, OECD and Financial Stability Board (FSB).
It is the first of the G-20 meetings scheduled to be held this year, of which Korea is the chair country.
The representatives, however, showed concern over the fiscal problems in some southern European countries.
Others pointed out that China and the United States are preparing exit strategies of their own.
The delegates agreed that they should share information regarding exit strategies as well as be flexible in implementing plans.
They also discussed voting rights at the international financial organizations. They agreed that at least 3 percent of the voting rights at the World Bank and 5 percent of the voting rights at the IMF should be transferred to newly emerging economies from developed economies.
Korean officials stressed at the meeting that a global financial safety net should be set up.
President Lee Myung-bak had suggested building the safety net at the World Economic Forum held in Davos, Switzerland, in January, to protect emerging countries against the volatility of international capital flows.
Expanding currency swaps, or setting up a regional monetary fund and bolstering the safety net at the IMF were suggested as solutions.
Though the global financial crisis started in developing economies, emerging economies were hit hard due to the lack of a worldwide financial safety net.
Some developed economies were reluctant to pass the reform plan, which would affect international financial organizations.
There has been conflict in international organizations regarding the quota, with emerging economies requesting that they should have more say, while developed economies don't want to meet their demands.