Group of Seven Meeting: Ministers Consider Ways to Curb Market Volatility; Approve Setting Up Financial Stability Forum
| Pages | 65-66 |
Page 65
On February 20, the finance ministers and central bank governors of the Group of Seven industrial countries met in Bonn to review developments in the world economy and to discuss issues of the international financial architecture. In their communiqué, the Group of Seven urged Japan and Europe to contribute to world growth through a strengthening of their economies. The communiqué also affirmed the Group of Seven's commitment to pursue "policies to help avoid excess volatility and significant misalignment of exchange rates of major currencies" and pledged to "continue to monitor developments in exchange markets and cooperate as appropriate" (see text of communiqué, page 66).
On debt issues, the participants said that they had agreed that the fundamental review and development of the joint IMF-World Bank initiative for the heavily indebted poor countries (HIPC) provided the appropriate framework to address the debt problems of these countries. They said: "We stressed the importance of improving thePage 66 HIPC Debt Initiative and discussed proposals from a number of Group of Seven partners for achieving this, for example, by reviewing the duration and criteria for debt reduction." They added that they would discuss these issues with a view to reaching agreement by the June summit meeting of the leaders of the major industrial countries in Cologne, Germany.
Concerning the reform of the international financial system, the Group of Seven participants noted the important progress that had been made since their previous meeting in October 1998. In particular, they
- agreed on a comprehensive format for including full information on reserves in the IMF's Special Data Dissemination Standard (SDDS) and asked the IMF to further strengthen the SDDS by including more complete information on external debt and investment;
- supported the progress made in developing a code of best practices for monetary and financial policy transparency;
- welcomed the progress made in developing an enhanced IMF facility providing a contingent short-term line of credit, accompanied by private sector involvement; and
- agreed to consider ways to improve IMF programs and procedures in crisis prevention and resolution, as well as appropriate institutional reforms, including reform of the Interim Committee and the Joint IMF-World Bank...
To continue reading
Request your trial