Created on Saturday, 12 April 2014 Written by HARRY DUNPHY, Associated Press MARTIN CRUTSINGER, Associated Press
WASHINGTON (AP) — Finance officials from the world's major economies believe an ambitious goal to boost global growth by $2 trillion in the next five years is within reach despite a variety of threats, including rising tensions over Russia's actions in Ukraine.
In a statement Friday, finance ministers and central bankers from the Group of 20 wealthy and developing nations avoided substantial differences in areas such as interest rate policies and tougher penalties against Russia.
Their talks were to resume Saturday with meetings of the policymaking committees of the International Monetary Fund and the World Bank.
In the G-20's statement, officials pledged to keep working on economic reforms that could increase growth by 2 percent over the next five years. But they acknowledged the political difficulty in the changes needed to reach that goal.
"We remain vigilant in the face of important global risks and vulnerabilities," the statement said. "We are determined to manage these risks and take action to further strengthen the recovery, create jobs and improve medium-term growth prospects."
Australia's treasurer, Joe Hockey, said officials know that hard decisions await regarding overhauling labor market policies and dealing with budget deficits.
"It is hard but that is the only way we are going to grow the economy," Hockey, the G-20 chairman this year, told reporters after the group's two days of discussions.
Next up is a September meeting in Australia, ahead of a G-20 summit Nov. 15-16 in Brisbane that President Barack Obama and other world leaders will attend.
The G-20 includes Russia, which helps explain why the group's statement did not mention the Obama administration's threat of "additional significant sanctions" if Moscow were to escalate surrounding Ukraine.
Instead, finance officials said they were monitoring the situation in Ukraine and were "mindful of any risks to economic and financial stability."
But at a news conference late Friday, Treasury Secretary Jacob Lew insisted there was strong support for harsher penalties, saying that Western allies "stand together in asking Russia to step back."
The G-20 endorsed the $14 billion to $18 billion loan package that the IMF has developed to help Ukraine avoid a financial collapse.
IMF officials have said its board probably will approve the assistance plan by early May.
The U.S. and various European nations have imposed an initial round of penalties aimed at punishing Russia for its annexation of the Crimean Peninsula.
The U.S. is raising the prospect of tougher ones if Russia attempts to annex parts of Eastern Ukraine. European officials have been hesitant to go further, worried about possible economic retaliation by Russia.
Also missing in the G-20 statement: a lengthy section from its February statement concerning the need for continued low interest rate policies by central banks.
Britain's chancellor of the exchequer, George Osborne, said, "I wouldn't read too much into that." He joked, "We're trying to keep the communique much shorter."
He noted that the Federal Reserve and the Bank England were moving cautiously to reduce stimulus efforts as the U.S. and British economies improve. Some critics have expressed concerns that there is a danger that central banks could move too quickly to reduce support before labor markets improve.
The U.S. came in for criticism in the G-20 statement for the failure of Congress to approve funding for the IMF that's needed to put in place a reform program that the 188-nation lending agency adopted in 2010.
That program would give the IMF more resources to help countries in economic distress and provide greater voting rights to developing economies such as China.
The measure has stalled in Congress for years.
The G-20 officials said the IMF should explore other options, which weren't specific, if U.S. approval doesn't come by year's end.
World Bank: http://www.worldbank.org