G-20 adopts target for 2% more growthSYDNEY - The world’s top economies have adopted a soft target of adding at least 2 percentage points to growth over five years, a source said, signaling optimism that the worst of crisis-era austerity was behind them.
The final communique from the two-day meeting of Group of 20 finance ministers and central bankers in Sydney said they would aim to boost collective growth by “more than 2 percent,” a G-20 official said, speaking on condition of anonymity.
It included a pledge to take concrete action to increase investment and employment, among other reforms, the source said.
The group accounts for around 85 percent of the global economy.
There was a nod to concerns by emerging nations that the Federal Reserve consider the impact of its policy tapering, with the communique saying central banks would be mindful of the effects on the global economy.
The G-20 communique also stated that it “deeply regrets” that progress on giving emerging nations more say in the International Monetary Fund had stalled, the source said.
Major emerging powers including India, China, Brazil and Russia have long lobbied for increased voting power in the IMF to reflect their growing share of the world economy, but the changes have been blocked by the U.S. Congress.
The two-day meeting ends on Sunday with a round of news conferences by top officials, including European Central Bank President Mario Draghi and IMF Managing Director Christine Lagarde.
The growth plan borrows wholesale from an IMF paper prepared for the G-20 meeting, which estimated that structural reforms would raise world growth by about 0.5 percentage points per year over the next five years, boosting global output by $2.25 trillion.
The IMF has forecast global growth of 3.75 percent for this year and 4 percent in 2015.
The target remains vague at the moment, with no road map on how nations intend to get there or repercussions if they never arrive. The aim was to come up with the goal now, then have each country develop an action plan and a growth strategy for delivery at a November summit of G-20 leaders in Brisbane.
Agreeing on any goal is a step forward for the group that has failed in the past to agree on fiscal and current account targets. And it was a sea change from recent meetings where the debate was still on where their focus should lie: on growth or budget austerity.
Australia is acting as president of the G-20 this year, following Russia in 2013.