A meeting of the world’s 20 most powerful finance ministers and central bankers has ended in Australia with a promise to set a firm target for global economic growth. The G20 accounts for 85 percent of global production, and two thirds of the world's population. Its aims are to conquer economic uncertainty, foster growth and create jobs.
Host Australia urged the G20 to agree to faster global growth targets. Australian treasurer (finance minister) Joe Hockey had insisted that the G20's collective gross domestic product, or total value of goods and services, could be raised by "at least two percent" above current projections during the next five years.
Hockey has been able to convince his G20 colleagues to adopt the growth target, which is not binding but could create tens of millions of jobs around the world.
Australia has acknowledged recent signs of stronger economic growth in the United States, Britain, Japan and China, but has stressed that the global economy has yet to achieve sustainable and balanced growth.
A two-page communiqué said the nations would “develop ambitious but realistic policies” that would “lead to significant additional jobs.”
U.S. Treasury Secretary Jack Lew praised the summit’s spirit of cooperation. "This was a debate about how can we work together to share best practices and develop an approach where our individual economies can grow,” he said.
Finance ministers and central bank governors from the world's top economies, along with the head of the International Monetary Fund, Christine Lagarde, have held two days of closed sessions.
Tim Harcourt, an economist at the University of New South Wales, says the mood of the Sydney meeting has been positive.
“I think it is important because of the tangible information, tacit information that they will swap, and they swap notes. I saw Christine Lagarde, the head of the IMF [International Monetary Fund], you know, she is rarely in Australia, so I would have thought it is a good chance for them to exchange and swap notes as they always do," Harcourt stated. "But also do it in Asia, do it in Asia, do it in a part of the world that is actually growing compared to where they are normally meeting.”
Another key focus of the conference was the shockwaves being felt by some emerging economies from the U.S. Federal Reserve’s easing of its huge stimulus program, which has seen a flow of capital back to the United States and led to currency volatility in other countries.
Emerging nations have been unsettled by the restricting of cheap and easy credit, which has begun to dry up as U.S. authorities slow the printing of more money.
Countries led by Indonesia, South Africa and Brazil have called on the U.S. to provide more information on its stimulus reduction. Australia has said there should be better communication and more transparency about policies that affect international markets.
G20 officials in Sydney have also been focusing on how to free up labor markets and to encourage more investment in infrastructure.
Measures discussed at the Sydney conference may also be at the forefront when the leaders of the G20 grouping of nations hold a summit in the Queensland city of Brisbane later this year.