Finance ministers and central bank governors from member countries of the G-20 – Group of 20 industrialized and emerging countries – reached a compromise on Saturday by establishing a list of indicators for determining the global financial imbalances, which, according to economists, contribute to worsening financial crisis.
After extensive negotiations with China, which has long shown reluctance, and with the contribution of all the participants in the meeting, “we came up with a mutual agreement”, stated a press release from the French presidency of the Forum.
That list does not take into account foreign exchange reserves, one of the most controversial measures, which raised serious objections from China, accused to hold huge foreign currency assets.
The main indicators make reference to a country’s domestic imbalances, deficit and public debt, private savings, and external imbalances, such as exchange rate, the same document states.
The agreement represents a partial success for France, which holds the annual presidency of the G-20, and the achievement is to some extent due to lobby led by France and Germany toward China.
G-20, which has become a key economic decision-making forum during the financial crisis in 2008 and 2009, is attempting to maintain this standard in the context of the economic recovery of some states.