G20 hopes to turnaround the global economy

Global leaders are meeting in London to discuss measures to tackle the downturn and commit for a more secure world. Maybe each have a unique agenda, hope this does not end-up in another April Fools gimmick, and they reach some concrete, just and visible steps to encounter many pending global issues! The G20 countries include Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey, United Kingdom, USA and EU.

Many in developing nations like Indonesia, Mexico, Nigeria, Ghana, India, Kenya, Egypt, the Philippines, Turkey etc. are highly affected by the downturn, while West European countries are hit fairly. Of course, being the major source of this financial disaster, US is badly affected. People are more concerned about rising food prices than the downturn in most of the countries and shortages of credit for mortgages and other loans has personally affected many millions.

The G20 draft has committed some amount of money to be distributed through international financial institutions for bank recapitalization, infrastructure, trade finance, debt rollover, and social support. They will also discuss importance of improving the regulation of financial systems, recognizing the importance of global cooperation. Future regulation and supervision to promote transparency, guard against systemic risk, dampen financial and economic cycles, reduce reliance on risky sources of financing, and discourage excessive risk-taking.

On the downside, employers and workers are worried about job losses and demand slump and this might tempt leaders to protect their own economies at the expense of others. G20 leaders should avoid the mistakes of 1933 when leaders failed to agree on plans to revive the global economy in the midst of the Great Depression. Trade barriers went up across the world, countries engaged in competitive devaluations of their currencies, and rising unemployment contributed to political instability across Europe. This resulted in serious collapse of global political and economic order, with the French and British concluding that the US was unreliable ally and Germany emboldened to move towards rearmament, which lead to some deadly Wars the world has ever seen!