What G20 Leaders Must Do to Stabilise our Economy and Fix the Financial System
The world is at a dangerous point. Governments and central banks have staunched the bleeding in their financial systems. They seem unprepared, however, for the next round of difficulties that will arise as the recession grows and financial crises spread to emerging markets. Economically and financially, there is a clear sense that things are spiralling out of control again.
The G20 meeting in Washington next weekend is an opportunity for the leaders to show that they have the will to solve the global crisis. This E-book collects essays on what the G20 should do. The authors � world-class economists from around the globe � identify four priorities for action:
� In the financial sector, act quickly, strengthen and coordinate emergency measures to staunch the bleeding; in the real sector, use fiscal stimulus to get the patient's heart pumping again.
� Act immediately to strengthen the ability of the IMF and other existing institutions to deal with the crisis in emerging markets.
� Start thinking outside the box about longer term reforms.
� Above all, do no harm.
Political conditions are not propitious, yet the state of the world economy is too delicate to wait. An empty declaration that shows our leaders are unable to agree on priorities will tell investors that the future will resemble the recent past. The wrong outcome from this meeting could damage the world economy rather than repair it.
The authors are: Alberto Alesina, Erik Bergl�f, Willem Buiter, Guillermo Calvo, Stijn Claessens, Paul De Grauwe, Wendy Dobson, Barry Eichengreen, Daniel Gros, Refet G�rkaynak, Takatoshi Ito, Vijay Joshi, Yung Chul Park, Raghuram Rajan, Dani Rodrik, Michael Spence, Guido Tabellini, David Vines, Ernesto Zedillo and Jeromin Zettelmeyer.