Highlights: G20 finance officials at IMF/World Bank meetings

Reuters News
Posted: Apr 14, 2011 9:15 AM
Highlights: G20 finance officials at IMF/World Bank meetings

WASHINGTON (Reuters) - Below are highlights of comments on Thursday from officials attending the International Monetary Fund and World Bank spring meetings.

Finance officials from Group of Seven industrialized nations and the Group of 20 major economic powers will meet in conjunction with the IMF and World Bank meetings.


"Despite the risks in oil, despite the financial challenges still facing parts of Europe, despite what's happened in Japan, the tragedy in Japan, despite the headwinds that those create for recovery, what you see is gradual healing, gradual strengthening in confidence that the world economy is going to be growing at a reasonable rate. Of course we want to make sure we sustain that, but as that happens, what you see is the encouraging signs of people just being willing to go out and invest again. Employment growth is increasing, people are taking more risk again."


"You also see a lot of confidence in markets that the American political system will be able to get our fiscal path on a sustainable position. If you look at what we pay to borrow, the world basically believes that our problems are manageable, our system will solve it, but you want to make sure that we're earning that confidence every day. We have to act to justify that, to sustain that."


"We've got very different ideas on how to do this, what the right thing to do for the economy is. But the important thing, it's important for people who look at Washington from afar to understand this -- when you have the president of the United States and the Republican leadership in Congress both embracing the same basic target for deficit reduction, roughly 4 trillion (dollars) over 12 years, so that our deficits fall below 3 percent of GDP ... when both sides embrace that and your debate is about how to do it, you've made the fundamental shift. That's very important. It makes it very hard for future presidents, future Congresses to decide that you can live with the risk of higher deficits in the future."


"They will do it.

"They understand that you can't take any risk the world starts to think the United States won't meet its obligations. There's no conceivable way that this city, this government can court that basic risk. It would be deeply irresponsible to do that and you can't take it too close to the edge.

"And you know, I sat with the president and the leadership of both houses, both parties yesterday morning and the Republican leaders say in private what they say in public, which is to say 'of course we recognize we have to pass the debt limit, of course we recognize that America will meet its obligation.

"But we also want once again to take advantage of this moment to try in a sense to lock everybody in to what you call in many parts of the world a fiscal rule, a constraint, that over a period of many years will bring our fiscal position down to a sustainable level."