The G20 leaders agreed today to boost stimulus measures aimed at shoring up the fragile global economy. Most notably, the leaders committed to pouring an extra $1 trillion (all figures U.S.) into the International Money Fund. The IMF will see its total budget tripled to $750 billion and will also benefit from an extra $250 billion in the form of a Special Drawing Rights allocation. Another $250 billion has been committed to finance international trade. World leaders also agreed to strengthen the global regulatory framework governing banking and investment, including the establishment of a new international accounting system, an end to tax havens, and new compensation rules aimed at stamping out rewards for failure. Although British Prime Minister Gordon Brown was quick to celebrate the coming of a “new global age,” some countries’ grievances went unaddressed. Russia unsuccessfully campaigned in support of China’s suggestion that the world adopt a reserve currency other than the U.S. dollar, while France and Germany resisted U.S. efforts to push for higher government spending and tax cuts to stimulate the global economy.
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