The upcoming G20 summit in London should pass five tests for its success, including a consensus on fiscal stimulus and global financial reform, European Commission President Jose Manuel Barroso said on Tuesday.
"I believe this summit will be judged on five main aspects," Barroso told a pre-summit press conference in Brussels, which reached here.
Setting out the European Union (EU)'s joint position at the London summit, which will take place on Thursday, Barroso said the first test should be the world-wide coordination of fiscal stimulus.
"The key to recovery is boosting global demand. Demand means jobs. And jobs are our first priority," he said.
To create lasting demand, a confidence stimulus is also needed, which requires a very ambitious reform of financial markets.
"But equally important, it requires trust in the financial system. That is why more regulation, effective sensible regulation, is essential," Barroso said.
The EU is putting into place tougher regulations on credit rating agencies, capital requirements and deposit guarantees. The commission will very soon take action on hedge funds, private equity and remuneration.
"The challenge for the G20 is swift, coherent and global implementation of financial market reform," Barroso said, adding he was pleased with the U.S. announcement to come with proposals on capital requirements and hedge funds.
Thirdly, Barroso said the world needs a global governance stimulus, which means the international financial institutions, in particular the International Monetary Fund (IMF), should be reformed to reflect the global reality.
"Emerging economies must have an equitable stake (in the IMF). EU member states will have to be flexible on how this is achieved, " he said.
Barroso said there can be no recovery without free and fair trade.
"The G20 must again say three important words loud and clear: no to protectionism," he said. "We must move ahead with the Doha talks, which could boost the global economy by at least 150 billion dollars per year."
As the last test, the London summit must come out with a development and climate change stimulus.
"There can be no recovery without fairness vis-a-vis the developing countries and coherence with our fight against climate change," Barroso said.
(Xinhua News Agency April 1, 2009)
