US pushes for new G4 group as G7 finmins gather in Turkey

The Group of Seven rich nations hopes to decide its future as an institution.

US pushes for new G4 group as G7 finmins gather in Turkey

The Group of Seven rich nations hopes to decide its future as an institution on Saturday, with the United States pushing for the creation of a smaller core group that would include China, a G7 official said.

The official, speaking on condition of anonymity, said Washington wanted to see the G7 supplanted in global economic policymaking by a Group of Four that would bring the United States, Europe and Japan together with China.

The official was speaking ahead of a meeting of G7 finance ministers and central bankers in Istanbul later on Saturday. The G7 is gathering on the sidelines of the semiannual meetings of the International Monetary Fund and World Bank.

For more than a decade, the G7 dominated international policymaking. But the financial crisis has undermined its power, as big developing economies such as China have become key to managing the global recovery.

Any formal move to supplant the G7, which comprises Britain, Canada, France, Germany, Italy, Japan and the United States, would likely be diplomatically complex and controversial.

Its top finance officials have traditionally met several times a year, seeking to guide foreign exchange rates and other markets through communiques released after their meetings.

But the group's role has appeared in doubt since a larger group of nations, the G20, earlier this year became the main forum for debating the financial crisis. The G20 has agreed in principle to tighten financial regulation and try to reduce trade imbalances that destabilise the global economy.

"The G7 is not quite dead, but it is losing its relevance," the IMF's managing director, Dominique Strauss-Kahn, was quoted as saying by Emerging Markets magazine on Saturday. "It's on its way to extinction."

Reuters
Last Mod: 03 Ekim 2009, 18:18
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