WASHINGTON — The world’s major economies have reached an agreement on how to measure the types of dangerous imbalances that contributed to the worst global downturn in seven decades.
The deal was announced in a joint statement issued following a day of talks among finance officials from the Group of 20 rich industrial nations and major emerging markets, such as China and Brazil. The effort will monitor countries and prod them to take corrective actions when imbalances in such areas as foreign trade or government debt rise to excessive levels.
French Finance Minister Christine Lagarde said the agreement is a significant achievement that will maintain the momentum to revive the global economy and prevent future financial crises.
Lagarde said that in the beginning, the monitoring process would focus on the world’s largest economies but eventually would be broadened to include all nations in the G20.
The G20 is composed of the traditional economic powers including the United States, Japan and European nations as well as fast-growing emerging markets including China, now the world’s second largest economy, India and Brazil.
After the financial crisis struck in the fall of 2008, the G20 took over from the G7 as the pre-eminent policy-setting group for the global economy. The talks Friday were part of three days of discussions and will wrap up today with meetings of the steering committees for the 187-nation International Monetary Fund and the World Bank.
