G-20 Leaders Eye More IMF Funds, Tighter Regulations (VIDEO)

LONDON — Leaders from around the globe made headway Thursday on tackling the world's worst financial crisis since the 1930s, with signs of agreements to give more money to the International Monetary Fund, clamp down on tax havens and tighten regulation over freewheeling hedge funds.

A British official said the Group of 20 rich and developing countries would likely approve giving more than $500 billion to the IMF so it can increase its loans to governments struggling because of the financial crisis. The official spoke on condition of anonymity because talks were ongoing.

Two other people close to the negotiations said France and Germany had persuaded the Group of 20 leaders to back tougher language in the final statement on stronger financial regulations to avoid a repeat of the current crisis.

Opening the summit in London's east Docklands district, British Prime Minister Gordon Brown said there was strong unity among leaders.

"I believe that the text that has been circulated already reflects a very high degree of consensus and agreement between all of us," Brown told his fellow leaders.

Britain's Finance Secretary Stephen Timms said early discussions had been "lively," but added that countries would agree on sanctions against countries who refuse to sign up to new rules on regulating tax havens.

"The era of banking secrecy is over," Timms said.

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As President Barack Obama and Brown joined other leaders at a working breakfast, protesters began gearing up for a second day of demonstrations, gathering outside the London Stock Exchange near St. Paul's Cathedral. Riot police took up their positions as well, ringing the stock exchange.

French daredevil Alain Robert scaled Lloyds of London's high-rise headquarters, as office workers below snapped photos. Robert, dubbed the French spider-man, has scaled dozens of tall structures around the world without ropes or harnesses to draw attention to global warming. He was later led away by police.

Addressing tax havens and other regulatory issues had threatened to derail the summit, with French President Nicolas Sarkozy and German Chancellor Angela Merkel insisting the meeting must take concrete steps on tougher financial regulation.

Sarkozy had previously threatened to walk out if the summit didn't achieve a strong statement on new financial regulations, warning that he considered action on tax havens, hedge funds and ratings agencies as the absolute minimum the negotiations must resolve.

Sarkozy and Merkel want the G-20 to publish a blacklist of tax havens and announce sanctions at the end of Thursday's meeting.

A French official, speaking on condition of anonymity, said that leaders were moving "slowly together" on the regulation issue.

Sarkozy and Merkel have tried to push regulation to the fore, calling for new scrutiny of ratings agencies and lightly regulated hedge funds. The summit will also examine ways to get so-called toxic assets _ unsellable securities such as mortgage-backed bonds _ off banks' balance sheet where they are impeding lending to consumers and businesses.

The British official said the boost to the IMF would include significant pledges from China, and in return there would be increasing efforts to give China and other emerging countries greater clout on the IMF.

Spanish Economy Minister Pedro Solbes said the G-20 leaders agreed "on making a major extra effort in terms of contributing resources and on what the IMF does," including adopting a model for granting more flexible loans.

Obama has acknowledged that U.S. regulatory failures contributed to the crisis in the financial system, but urged a focus on solutions, saying "we can only meet this challenge together."

European leaders have balked at moving beyond spending measures already announced, arguing that their more generous welfare systems mean their spending level will rise as more people get benefits such as unemployment insurance.

As leaders met in the Docklands, a former shipping area on the Thames river that was redeveloped as an international business center, protesters began a second day of demonstrations. Security was tight at the summit venue; hundreds of police manned barriers and checkpoints around the security perimeter.

Near St. Paul's Cathedral in the financial district, protesters played a giant Monopoly game.

"The question is of course who has got the monopoly? It is fairly obvious the G20 are the global financial elite," said protester Clare Smith, 27. "Meanwhile the poor are getting poorer."

Some 4,000 anarchists, anti-capitalists, environmentalists and others protested Wednesday around the Bank of England for what demonstrators had called "Financial Fool's Day."

They repeatedly overwhelmed police lines, vandalizing the Bank of England and smashing windows at the Royal Bank of Scotland. An effigy of a banker was set ablaze, drawing cheers. In all, police arrested 86 protesters.

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AP reporters Jorge Sainz, David Stringer, Emma Vandore and Pan Pylas contributed to this report.

Comments

[jgzeger]

If the U.S. doesn't agree to more international regulation of the global financial system, then the rest of the world has every right and justified in forming trade alliances that exclude the U.S. Obama may be showing everyone that he is not a push-over but he is behaving just like Bush in his lack of international cooperation and "go it alone " attitude. So much for "change". But then I never bought into the "change" bit and thought we'd see more of the same. Perhaps Obama is just rewarding all his Wall Street friends who contributed to his campaign.

[isolow]

Come ON people - you've got to be kidding me... 5 comments total on the fact that we're seeing the start to the international regulation of the financial institutions via the IMF thanks to the new G20 "deal"

And you'd rather give 454+ comments on the first lady touching the queen!

no wonder we're in trouble...

[isolow]

surprise! NOT!

"The role of the Bretton Woods institutions has been controversial since the late Cold War period, as the IMF policy makers supported military dictatorships friendly to American and European corporations. Critics also claim that the IMF is generally apathetic or hostile to their views of democracy, human rights, and labor rights. The controversy has helped spark the anti-globalisation movement. Arguments in favor of the IMF say that economic stability is a precursor to democracy; however, critics highlight various examples in which democratized countries fell after receiving IMF loans.[6]

In the 1960s, the IMF and the World Bank supported the government of Brazil’s military dictator Castello Branco with tens of millions of dollars of loans and credit that were denied to previous democratic­ally-elect­ed governments."

http://en.wikipedia.org/wiki/International_Monetary_Fund#IMF.2FWorld_Bank_support_of_military_dictatorships

[THEPILGRIM]

The British are not our friends, they are our enemies. They want to establish a British Empire that controls the world, incl. the US.
Geithner wants to increase funding to the IMF to $ 500 billion and to subject the global economy to the IMF, World Bank and Financial Stability Forum a policy which is totally coherent with that advocated by the British Empire. We don’t want that. The IMF has done nothing good in the past. The world wide poverty has been growing and the financial oligarchy and the corporations have dominated everything else. We need to change this,
Summers again manipulated the President to come up with a second multibillion dollar bailout for Wall Street. This is so the tax payer is covering for the losses of Wall Street speculations. Summers is known to support the interests of the financial oligarchy, e.g. in 1999 when he was in charge of the US finances he got rid of the Glass – Stegall laws that Roosevelt put in place in order to protect the regular banks of speculation.
Summers is following London – Gordon Browns failed politics. It is clear that the British model has failed. The British pound is down 30% the British deficit is at 10%, the biggest banks are nationalized. Economically Britain is only on 12th place in Europe and the latest attempt to sell treasury bonds failed because they are worth less. But Brownomics is the model for Presidents Obama right hand Summers!

[Tulu]

Fleecing the G-20
Alemayehu G. Mariam | April 2, 2009

http://www.ethiomedia.com/adroit/2083.html

he writer, Alemayehu G. Mariam, is a professor of political science at California State University, San Bernardino, and an attorney based in Los Angeles. For comments, he can be reached at [e-mail]

[Tulu]

Fleecing the G-20 :

A Must Read Write from know Civil Right activist, Scholar.

http://www.ethiomedia.com/adroit/2083.html

The writer, Alemayehu G. Mariam, is a professor of political science at California State University, San Bernardino, and an attorney based in Los Angeles. For comments, he can be reached at [e-mail]