G20 to replace G8 as global economic policy forum


Pittsburgh : Reflecting the growing economic clout of India, China, Brazil, and other fast-growing developing countries, the G20 will permanently replace G8, the once elite club of rich industrial nations, as a global forum for economic policy.

Support TwoCircles

The Group of 20 – leaders of 20 countries representing 90 percent of the world’s economic output – meeting here for a two-day summit will make the announcement later Friday as they wind down their deliberations focusing on the financial crisis and how to avoid one in future, the CNN reported.

The move comes in the wake of a major push by President Barack Obama, the channel said citing senior US officials. The G20 will now essentially eclipse the G8, which will continue to meet on major security issues but carry much less influence.

“It’s a reflection of the world economy today and the players that make it up,” said one senior official. Nations like China, Brazil and India – which were locked out of the more elite G8 – will be part of the larger group.

“We’re meeting at a time where, for the first time since London, certainly for the first time in a year, we’re seeing the first signs of optimism about prospects for global recovery,” US Treasury Secretary Timothy Geithner told reporters Thursday.

“I think the broad consensus of private economists and businesses are that we’re beginning to see growth in the United States, and around the world we see exports rising and forecasts for growth are being revised upwards.

“This is encouraging,” he said, “but we have a ways to go.”

He said the leaders are “going to keep working to sustain the progress we’ve seen. And I can say with confidence, based on my discussions with finance ministers and central bank governors from around the world, there is a common, shared commitment to make sure we’re working together to sustain these early signs of recovery and growth.”

One of the key goals is preventing such a crisis from occurring in the future, he said.

The economic summit marks the third time in a year that the world’s top industrial powers have gathered. They met in November in Washington and followed up with an April session in London.