G20 adopts key resolutions on deficit reductions and exit strategies implementation
TORONTO, Canada — The G20 leaders have called for drastic reductions in national budgets deficits, effective from 2011 and halve them by 2013, and also for the gradual withdrawals of the state anti-crisis fiscal stimulation measures adopted at the peak of the global economic meltdown to keep governments and corporations in business.
This decision proved difficult to adopt as there were different positions on timing the scopes and implementation of these initiatives by G20 members. For example, the United States believes it is not yet time to repeal the anticrisis measures, as national and global economies still need more fiscal support to maintain the current positive growth trends, while most European countries, on the contrary, have already started implementing drastic ‘belt-tightening austerity’ measures in their economies in a move aimed at avoiding a repeat of the ongoing Greece fiscal disaster.
According to the Russian G20 delegation, Kremlin had started implementing these measures much earlier than other states. For example, Russia plans to lower its budget deficit to 5.4% in 2010 and to almost 2% by 2013, a policy that is completely in line with the G20 recommendations.
On the crisis exit strategies, Moscow’s position, according to the Russian G20 delegation, is that it is time not only to start drafting the measures needed to withdraw the stimulation measures from economies, but also to take steps to boost their overall effectiveness on the economies and state institutions as a whole. The G8 and G20 consensus on this issue calls for coordinated implementations of exit strategies, but not necessarily in a synchronized order.
By Adrian Moore (Toronto, Canada)
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