G20, meeting in Washington, to seek answers on looming U.S. debt crisis

Wed Oct 9, 2013 7:21pm EDT
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By Jason Lange

WASHINGTON (Reuters) - Top finance officials from the world's leading economies gathering later this week will look for straight answers from the United States over the political dysfunction that threatens to throw the world's largest economy into default.

Leaders from the Group of 20, a forum for the world's biggest rich and poor nations, met only a month ago, so major new agreements on economic policy are unlikely.

"The situation in the U.S. will likely dominate the talks," said a G20 official involved in drafting a group statement due on Friday following a two-day meeting in Washington.

Policymakers worry political deadlock in Washington might block the raising of the ceiling on U.S. government borrowing and lead the United States to default on its debt later this month. That could trigger a financial crisis and a global recession.

Still, it was unclear whether Washington's woes would get "substantial" mention in the final G20 statement, a South Korean official said.

A member of the German delegation said it would mostly be a "copy-paste" job from the statement issued when officials last met in St. Petersburg.

The official involved in drafting the statement said finance ministers and central bankers would use much of the phrasing from St. Petersburg as a starting point. The statement would highlight signs of improvement in Europe's economy, slowing growth in poor countries and the risks created by years of low interest rates in the developed world, the official said.

LOSING FOCUS   Continued...

A lone worker passes by the U.S. Capitol Building in Washington, October 8, 2013. REUTERS/Jason Reed