G-20 to hold FinMin meet amid global growth scare

Amid global growth scare and economic shock waves from China , finance ministers and central bank governors of G-20 nations will meet in Turkey’s capital Ankara on September 4-5 to firm up strategies on global growth and investments amid looming competitive devaluation of currencies.

Before leaving for G-20, Finance Minister Arun Jaitley expressed concern the recent currency devaluation of major economies and a potential threat emanating out of that in emerging markets.

“The recent devaluation of major currencies followed by currency depreciations in a large number of Asian emerging markets raises the risk of competitive devaluations.

“Competitive currency devaluations, at a time when global demand is sluggish, is a major threat to stability in the global economy,” Jaitley said ahead of his departure to Ankara .  He said ministers and policy makers of the largest conglomeration of developed and emerging economies, will deliberate on the recent global economic developments and challenges. A finance ministry statement quoted him as saying that the meeting will discuss steps to address these problems.

“The attempt in Ankara would be to analyse the situation and consider collaborative measures like developing the global safety nets to protect countries from negative spillovers arising from domestic actions,” Jaitley said.

China recently devalued its currency Yuan and its central bank announced a monetary stimulus to perk up the slowing economy. This sent a scare of a competitive devaluation among emerging economies and a currency war.

International Monetary Fund (IMF) warned that China’s shift to a new growth model and the related action could have a cross border spillover effect.