The Wall Street Journal reports: ''finance leaders from the world's biggest economies called for support from central banks and private-sector infrastructure spending to help spur growth, reverting to the global economy's playbook of recent years in an effort to safeguard a fragile recovery.
Group of 20 officials ended their summit this weekend saying they would look to boost world growth by more than $2 trillion over the next few years under a strategy crafted by the International Monetary Fund.
Under the G-20 plan, advanced economies would continue with their easy-money policies while emerging markets would seek to restructure their economies and tame inflation. In addition, governments everywhere would be expected to channel private-sector finance into new infrastructure projects.
The IMF, which expects growth of 3.7% this year and 3.9% in 2015, says its plan would add half a percentage point to global growth annually over the coming four years. The finer points will be hammered out in the run-up to the G-20 leaders' November summit.
The G-20's final communiqué also highlights agreement among central banks to communicate their stimulus-exit strategies clearly and in a timely fashion. The measure was adopted following a selloff in emerging-market stocks, bonds and currencies after the Federal Reserve signaled it would begin winding down its quantitative-easing program. Another selloff was triggered by several countries, including Ukraine andTurkey, that experienced political upheavals.
The communiqué warned that the global economy faces a period of potential "excessive volatility" harmful to growth as countries adjust their economic policies. "We do not want any surprises," Joe Hockey, Australia's treasurer and G-20 host, told journalists at the conclusion of the summit on Sunday.
During the G-20 meetings, some developing countries had complained the Fed was moving too fast in withdrawing stimulus, but the U.S. also pushed back. "Emerging markets need to take steps on their own to put their fiscal house in order, to put structural reforms in place," Treasury Secretary Jacob Lew said on Friday. He added that governments had to move ahead with unpopular reforms even though they might fear inciting social unrest''.
