Group of 20

• Pages: 10

Page 10

The Group of 20 was established in September 1999, as a new mechanism for ongoing consultation on matters pertaining to the international financial system. Paul Martin, Minister of Finance of Canada, was appointed by the Group of Seven as Chairman for a two-year term. In his statement to the Interim Committee during the 1999 Annual Meetings, Martin described the proposed functions and objectives of the new group. Following is an edited extract. The full text of Martin’s statement is available on the IMF’s website (www.imf.org).

Earlier this year, the Group of Seven created the Financial Stability Forum, which has the critical role of identifying gaps in the regulation of financial systems and pointing to solutions to address these vulnerabilities. The forum has set up three working groups that are studying important issues in the international financial system.

These steps contribute important improvements to the international architecture. As we have seen over recent years, however, we still need a forum that can provide a broad overview and that can address issues that go beyond the responsibilities of any one organization or that involve more than financial regulation per se. The crises of the last two years have clearly demonstrated that there are close links between exchange rate regimes, financial systems, the real sectors of our economies, and society at large. The crises have also shown that what happens in emerging markets matters in a big way to everyone. There is...