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G7 finance chiefs reject protectionist measures

16 February 2009 08:23 (UTC +04:00)

Bakuâ€“ APA-Economics. The Group of Seven finance ministers pledged Saturday to avoid resorting to protectionism as they try to stimulate their own economies in the face of the world’s worst economic crisis since the 1930s, AP reports.
The meeting marked the international debut of U.S. Treasury Secretary Timothy Geithner, who assured his counterparts that President Barack Obama’s $787 billion plan to resuscitate the economy, approved Friday, would not violate in any way the United States’ commitment to free trade.
Geithner, who was among friends and colleagues he had worked with from his days at the Federal Bank, appealed to the "common imperative" to sustain open trade.
"These are global challenges and it is imperative that we work together to address them," Geithner told reporters afterward. "Effective global response will require sustained action by governments working with the international financial institutions."
The meeting’s host, Italian Finance Minister Giulio Tremonti, affirmed "strong agreement" among the ministers on rejecting protectionism.
"It is a concrete danger, not only for economies that depend heavily on exports," he said.
ven as gloomy economic news piled up â€” with Europe sinking deeper into recession and the G-7 itself saying the crisis will continue at least through the end of the year â€” the ministers touted in their final statement "the exceptional measures" that had been "collectively taken."
The meeting was largely an affirmation of actions already being taken â€” from the importance of stimulus packages to the need to isolate bad assets â€” but the final statement didn’t indicate how that would happen.
German Finance Minister Peer Steinbrueck said concrete progress on such measures as drafting regulations on hedge funds must be made at the Group of 20 summit in London on April 2, bringing together leaders of the industrialized nations with rising economic stars like China and Brazil.
Germany and Japan â€” net exporters â€” were especially keen to see the group endorse efforts to fight protectionism, Steinbrueck said, noting that 40 percent of German output was export-driven.
French Finance Minister Christine Lagard said the group recognized that protectionism can take many forms in the banking, financial and economic domain.
Looking ahead, the ministers hoped to make progress on drafting common principals of transparency within four months, in time for the Group of Eight summit in Sardinia in July.
The recommendations from Saturday’s G-7 meeting â€” attended by ministers from Britain, Canada, France, Germany, Italy, Japan and the United States â€” are expected to influence that gathering.