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November 13, 2008

Washington Finance Summit Seeks Ways to Combat Economic Slowdown
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Summit is first-ever gathering of leaders from 20 industrialized and
developing nations 
Amid a dramatic global economic slowdown, leaders of 20 developing and
industrialized economies are holding an emergency summit in Washington
Saturday, November 15. VOA economics correspondent Barry Wood reports on
what may result from a meeting whose formal discussions will last only
five hours. Traders on the Tokyo Stock Exchange gaze at digital
indicator as Japan's key stock index nose-dives on a rising yen and
growing recession fears in Tokyo (File Photo)When world leaders convene
in Washington, they will focus on a slowdown that has affected virtually
every country. In just months, $25 trillion have been erased from global
stock markets. Millions of jobs have been lost, and consumers are
holding on to whatever cash they have, sparking further declines. Former
US Treasury official Ted Truman helped plan financial meetings of
industrialized countries. He believes this broader gathering --not of
seven but of 20 -- is significant."I hope it will focus on the big
problem we face, which is global recession," he said. To maintain
consumer purchasing power and avoid calamity, leaders must commit to
coordinated measures, says Wing Thye Woo of Washington's Brookings
Institution.

 "Boosting government expenditure, lowering interest rates, and
countries should not engage in export promotion policies at this point,"
he explained. World Leaders Some countries, especially China, have
already announced emergency spending programs. Experts say China is
signaling a desire to play a bigger role in the global economy."They are
now important players and will become even more important in the
future," Woo said. "We need the Chinese to continue growing fast." The
need for better regulation of financial institutions will also be
discussed, as will the need for developing economies -- like China and
India -- to have a bigger say in the International Monetary Fund. Ted
Truman Ted Truman says the financial summit could mark the beginning of
regular consultations between developed and developing countries.

"I think the most significant thing about this meeting is that it
probably marks the beginning of the end of the G-7 as a summit
organization," he said. Annual G-7 summits of the United States, Canada,
Japan and western European nations have taken place for over 30 years.
The broader group accounts for 75 percent of global output. 


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