22 September 2011

G20 Communiqué after meeting in Washington

The G20 is taking strong actions to maintain financial stability, restore confidence and support growth. In Europe, euro area countries have taken major actions to ensure the sustainability of public finances, and are implementing the decisions taken by euro area leaders on 21 July 2011. Specifically, the euro area will have implemented by the time of the G20's next meeting the necessary actions to increase the flexibility of the EFSF and to maximise its impact in order to address contagion.

The US has put forward a significant package to strengthen growth and employment through public investments, tax incentives and targeted job measures, combined with fiscal reforms designed to restore fiscal sustainability over the medium term.

Japan is implementing substantial fiscal measures for reconstruction from the earthquake, while ensuring the commitment to medium-term fiscal consolidation. Heightened downside risks have also made the economic environment for emerging markets and developing economies more challenging, and they are adjusting their macro-economic policies accordingly to maintain stability and sustain growth. The contribution of the emerging market economies to global growth will increase as these economies as a whole move towards more domestic-led growth, including through structural reforms and enhanced exchange rate flexibility to reflect economic fundamentals. The G20 reiterates that excess volatility and disorderly movements in exchange rates have adverse implications for economic and financial stability.

The G20 is committed to supporting growth, implementing credible fiscal consolidation plans, and ensuring strong, sustainable and balanced growth. This will require a collective and bold action plan, with everyone doing their part. The G20 is working together to put in place for the Cannes Summit such an action plan of coordinated policies with both short-term decisions and a medium- to long-term perspective.

The G20 commits to take all necessary actions to preserve the stability of banking systems and financial markets as required. The G20 will ensure that banks are adequately capitalised and have sufficient access to funding to deal with current risks and that they fully implement Basel III along the agreed timelines.

Central Banks will continue to stand ready to provide liquidity to banks as required. Monetary policies will maintain price stability and continue to support economic recovery.

Full communique

© Reuters