Brussels, 22/09/2011 (Agence Europe) - The EU finance ministers and central bankers attending the G20 Finance Summit in Washington explained on Thursday 22 September that Europe's top priority is budget consolidation and that goes for all EU countries, in order to ensure continued and sustainable reduction of public debt. This is a different line from the United States, which is calling for urgent measures to kick-start the economy. This big difference in approach will make it difficult to meet the G7's promise to act together in a coordinated manner to deal with the lack-lustre global economy and the continued financial crisis. According to a policy document drafted at Wroc³aw and seen by this newsletter, European finance ministers and central bankers believe that economies in both surplus and deficit with the outside world alike should introduce appropriate measures to ensure balanced overall consumption. They believe the G20 should focus on issuing country-specific recommendations, preferably with quantifiable targets and a detailed timeline.
Europe believes that the decisions made at the 21 July eurozone summit on the second Greek bailout giving greater powers to the EFSF bailout fund should be sufficient to prevent the sovereign debt crisis from spreading any further. A list of priorities for financial regulation has been drawn up, including increasing the quality and quantity of bank capital (Basel III); introducing pay policy in the financial industry; ensuring better checks on shadow banking; reducing countries' reliance on rating agencies; and introducing greater transparency on the commodity and commodity derivatives markets. (MB/transl.fl)