G20 plan for investment targets runs into stiff opposition

Mon Feb 9, 2015 10:02am EST
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By Dasha Afanasieva and Orhan Coskun

ISTANBUL (Reuters) - Group of 20 finance officials look likely to reject a proposal to set countries specific investment targets to spur a global economy which appears increasingly reliant on the United States for growth.

The meeting of finance ministers and central bankers in Istanbul comes as Greece casts a new shadow over Europe, cheap oil plays havoc with inflation and growth forecasts and a strengthening dollar threatens emerging economies.

Deputy Prime Minister Ali Babacan said Turkey - G20 chair for 2015 - preferred to set binding national investment targets and that the idea was under discussion. But it appeared to be struggling to win support.

"It would be quite complicated and a bit theoretical," French Finance Minister Michel Sapin told reporters.

"I am pushing for a global objective. Europe can set its own target and deliver on it, but I don't support precise objectives for everyone else."

A G20 source said the idea had already been taken off the table.

U.S. Treasury Secretary Jack Lew said last week the United States could not be "the sole engine of growth" and a senior U.S. official said Washington's message would again be that Europe is not doing enough.

Germany, with its hefty current account surplus, has come under pressure at successive G20 meetings to spend more.   Continued...

International Monetary Fund Managing Director Christine Lagarde smiles while speaking at the National Assembly in Dakar January 30, 2015. REUTERS/Stephen Jaffe/IMF Staff Photograph Handout via Reuters