Global finance leaders, under pressure to display unselfish policies, agreed over the weekend to boost co-operation on rebalancing the world economy to help minimise fears of trade conflicts.
The Group of 20 vowed to avoid potentially debilitating currency devaluations and reduce trade and current account imbalances, amid a growing recognition that restructuring the world economy is necessary to accommodate the greater role played by fast-growing China and other developing economies.
G20 finance ministers and central bank governors met for two days in Gyeongju, South Korea, ahead of a summit of their leaders in Seoul next month. Just two weeks ago, a G20 meeting in Washington failed to resolve differences that had stoked worries of a possible trade war triggering another economic downturn.
Nations in Asia and other regions have been trying to stem strength in their currencies amid sustained weakness in the US dollar out of fear their exports will become less competitive.
"I think it's fair to say for the first time we see the major economies come together and recognise that excess imbalances that persist over a period of time, that can threaten growth and financial stability, need to bring about adjustments in policies," US Treasury Secretary Timothy Geithner (pictured above) said.