World leaders vow to halve deficits by 2013

08:49, June 28, 2010      

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Wary of slamming on the stimulus brakes too quickly but shaken by the European debt crisis, world leaders pledged Sunday to slash government deficits in the most industrialized nations in half by 2013.

They generally sided with cutting spending and raising taxes, despite warnings from U.S. President Barack Obama that any hastening austerity at the current stage could stifle the global recovery.

"Serious challenges remain," they cautioned in a closing statement. "While growth is returning, the recovery is uneven and fragile, unemployment in many countries remains at unacceptable levels, and the social impact of the crisis is still widely felt," according to the document from the Group of 20 major industrial and developing nations.

Summit participants navigated a careful course between Obama, with his emphasis on growth, and fellow leaders such as German Chancellor Angela Merkel who advocated spending cuts and tax increases.

"Advanced economies have committed to fiscal plans that will at least halve deficits by 2013 and stabilize or reduce government debt-to-GDP ratios by 2016," according to the statement.

At the same time, the statement incorporated Obama's cautions against winding down government supports too quickly. "To sustain recovery, we need to follow through on delivering existing stimulus plans, while working to create the conditions for robust private demand," it said.

Canadian Prime Minister Stephen Harper, the summit host, told a wrap-up news conference that "fiscal consolidation is not an end in itself" and that there is "an ongoing role for stimulus in the short term." Summit participants have been using the term "fiscal consolidation" to refer to spending cuts and tax increases.

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(Editor:张心意)

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