Showing posts with label G20 summit. Show all posts
Showing posts with label G20 summit. Show all posts

Friday, April 03, 2009

What The Developing and Poor Countries Got at G20 Meet

0 comments Posted by PD at 9:15 PM

Just making a bullet list of all the items that developing countries and poor nations got at the 2009 G20 summit in London.
  1. India and other developing nations to get a greater say in the international organizations such as IMF and World Bank.
  2. After 2011, the US could lose its veto power at those institutions and Western countries could find their voting rights severely reduced.
  3. The convention that an American heads the World Bank and a European heads the IMF will also now be abandoned, the G20 leaders say.
  4. The G20 also created a new Financial Stability Board, incorporating all members of the G20 for the first time, to replace the current Financial Stability Forum, which mainly consists of the central banks and finance ministries of US and European countries.
Funding Pledges:
  1. $500bn for the IMF to lend to struggling economies
  2. $250bn to boost world trade
  3. $250bn for a new IMF "overdraft facility" countries can draw on
  4. $100bn that international development banks can lend to poorest countries
  5. IMF will raise $6bn from selling gold reserves to increase lending for the poorest countries
If IMF have more money to lend then it means that poor countries are less reliant on Western nations when they get into trouble and need aid. Poor countries will also be less reliant on the value of the US dollar because IMF has its own accounting currency, SDR, which is a basket of major currencies such as dollar, euro, yen and pound.

Source: BBC

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Tuesday, March 24, 2009

Will The G20 Summit in April 2009 Fail Just Like The One in 1933?

0 comments Posted by PD at 7:37 PM

As delegates gather for the G20 summit in London on 2 April, it is worth looking to the last time London hosted a world economic summit. In June 1933, delegates from 66 countries gathered in London to try and agree plans to revive the world economy in the midst of the Great Depression. The author of this report from BBC argues that though the crisis this time is different but need of political will and the global nature of both recessions are same. If correct lessons are not drawn from the 1993 conference failure then it may happen again. The author also aomments that being the largest economy, US has to be have the political will to solve the world's problem rather than having a double agenda just like that of FDR. April 2nd is not far. Lets see what happens.

Read the full BBC article HERE

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A New Currency Other Than Dollar as World Stardard?

0 comments Posted by PD at 1:05 AM

China's central bank governor Zhou Xiaochuan has suggested that a new currency should be created in order to reduce the dependence on dollar. As most of the world trade is done in the Dollar, Euro and Yen, there is growing concern that world has become a hostage to these currencies. Mr. Zhou argues that most nations concentrate their assets in those reserve currencies(Show below), which exaggerates the size of flows and makes financial systems overall more volatile.



Moving to a reserve currency that belongs to no individual nation would make it easier for all nations to manage their economies better, he argued, because it would give the reserve-currency nations more freedom to shift monetary policy and exchange rates. It could also be the basis for a more equitable way of financing the IMF, Mr. Zhou added. China is among several nations under pressure to pony up extra cash to help the IMF.

Mr. Zhou's proposal is surely going to spark a debate in the coming G20 summit in London.

You can read the full article at Wall Street Journal HERE

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