TORONTO (Reuters) - Finance Minister Jim Flaherty said on Friday he was cautiously optimistic the Group of 20 wealthy and emerging countries could reach an agreement on targets for cutting their budget deficits.
“Lots of discussions have happened leading up to these meetings in Toronto this weekend. Not everyone is agreed on the targets but I think we have a reasonable prospect of getting there,” he told Canada’s CBC television, adding, “I‘m cautiously optimistic.”
“It’s very important we have concrete results ... we need the world economies to have confidence in what is happening and to grow.”
Prime Minister Stephen Harper sent a letter to his G20 peers this month proposing an agreement to halve deficits by 2013 and stabilize or start reducing debt-to-GDP ratios by 2016.
Leaders of the Group of Eight and G20 rich and developing nations are meeting in Canada from Friday to Sunday to discuss how to plot the world’s emergence from the worst financial crisis since the Great Depression of the 1930s.
A debate heading into the gathering has been how to strike a balance between providing stimulus for a still uneven economic recovery and moving to cut deficits in order to maintain the confidence of bond investors.
“I don’t think we have consensus on that yet and that’s why these meeting are important, the discussions that will take place the next 48 hours, so that we can get to a balance, which is what we’re really talking about,” he said.
“Not every country needs to dramatically consolidate right now. There can be some graduated moves by some of the economies that are in relatively good shape in terms of their indebtedness.”
Reporting by Jeffrey Hodgson; Editing by Peter Cooney