G-20 consensus has vanished: Buiter
Eminent economist Willem Buiter was in the capital on Tuesday to attend the Annual India Policy Forum. During his speech at the Shangri-la Hotel, Prof. Willem addressed his views on sovereign debts crisis in the West and the lessons India can learn.
Prof. Willem also pointed out that months after the heady consensus achieved during the G-20 Summit has vanished as the world fractured into blocs with dangerously differing interests.
He further pointed out that these summits have achieved some advances in global economic governance. He also said in his speech that the G-20 should henceforth be the principal forum for global economic coordination, bringing an array of emerging nations, including China, India and Indonesia as well as Australia, into the mainstream of economic decision-making.
“India, like the countries in the West, is making a series of commitments on economic and financial policy intended to support a global recovery, including the agreement that nations with external deficits would promote domestic savings, while those with external surpluses would promote domestic spending in an effort to reduce global imbalances,” said Prof. Willem.
He pointed out that these are good signs for economic progress. “This is a historic time for India because the country is making a place at the top economic table and moving towards global economic decision-making,” added Prof. Willem.
The forum also had a discussion on how the US is pressing the case for continued stimulus to support economic recovery, as its deficit is under continued pressure.
Prof. Willem also referred to US President Barack Obama releasing a letter to fellow leaders saying that nations should be prepared to inject additional stimulus into their economies if confronted with renewed weakness.
Prof. Willem further said that plans to restore budget sustainability should be “growth-friendly”.
Prof. Buiter joined Citi in January 2010 as chief economist. One of the world’s most distinguished macro-economists, Prof. Willem previously was professor of political economy at the London School of Economics and is a widely published author on economic affairs.
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