23 February 2009

European Leaders Meet Ahead of G20

Gordon Brown went to Berlin this weekend to meet with G20 leaders ahead of the next official G20 summit on the 2nd April, to be held in London.

Leaders from the biggest Eurozone economies met in Germany's capital to come up with some shared goals in order to deal with the economic crisis, which has affected the EU in different ways.

The main outcome of the meeting was the plan for an IMF fund of $500bn to boost the EU - an amount which Brown seems to think is not, in fact, quite enough. It is believed that the fund will help countries to deal with this crisis but also to deal with - and avert - future crises.

Some critics of the Euro as a single currency are increasing their argument as to why they believe it is detrimental to Europe, and that there is valid argument to withdraw. But there are others who are firm that the currency has, overall, been a success. Indeed, market traders would agree that as a whole the Euro has in its decade become a strong currency, despite the current problems. There have been major deficits in different countries' assets and current account balances - while stronger countries such as Germany have had to tighten their belts in order to deal with, what for them is a high interest rate, others have increased their spending and are therefore more behind.

Will there be increased argument for stronger economies to bail out weaker ones in the time to come? Or will the larger fiscal stimulus being introduced by many countries be enough to help?

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