It will be months before we know whether the G20 summit can succeed in downsizing the worst economic crisis since World War II to a temporary road bump on the path to greater prosperity.
Still, the immediate reaction on global markets to the summit's trillion dollar agreement could hardly have been more encouraging.
European share indexes surged more than 4 percent, with similarjumps on Wall Street and Japan's Nikkei as the agreement exceeded expectations.
"This is the day the world came together to fight back against the global recession," British Prime Minister Gordon Brown said in announcing the agreement. "Not with words but with a plan for global recovery and for reform."
MASSIVE AGREEMENT
Highlights of the agreement include:
-- additional resources of one trillion dollars to boost world trade and strengthen the International Monetary Fund's ability to help nations in economic trouble;
-- a plan to tighten regulation of the financial markets, including hedge funds and ratings agencies;
-- boosting international financial institutions, such as the IMF, and giving emerging markets and developing countries a greater voice and representation;
-- a pledge to reject protectionism;
-- a crackdown on tax havens;
-- a commitment to fighting climate change and aiding the world's poorest nations.
Most of the additional funds will be channeled into the IMF, which will see its reserves trebled to 750 billion dollars and allow it to help those nations on the verge of collapse.
In a nine-page statement, the G20 leaders said the combination of stimulus measures could raise output by 4 percent by the end of2010. That won't be sufficient enough to stop the short-term contraction of many G20 economies, but perhaps it will be able to make sure the recession does not turn into a replay of the 1930s Great Depression.
"We have agreed on a series of unprecedented steps to restore growth and prevent a crisis like this from happening again," said U.S. President Barack Obama, who described the summit as "a turning point."
Source: Xinhua
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