G-7 Meeting of Finance Ministers Wrap-Up

G7 Finance Ministers gather in the Nunavut Province (CAN) Legislative Assembly

The leading Central Bankers and Finance Ministers of the world’s seven major industrial nations, known as the G-7, wrapped up their first meeting of the year by pledging today to work to calm global markets and maintain government stimulus in order to help sustain a global economic recovery. Speaking for the group, Canadian Finance Minister Jim Flaherty said leaders of the G-7 nations also discussed strategies they will use to withdraw stimulus once the recovery strengthens. Yet Flaherty and other leaders did not indicate they were planning to propose any further stimulus beyond what they have already unveiled. They said they would push ahead with those efforts this year. Flaherty, as the host nation’s finance minister had chosen the remote town of Iqaluit, population 7,000, capital of the Nunavut province in the Northern territories where temperatures can dip to – 40^o below zero in February.

Flaherty spoke as the G-7 officials ended a two-day meeting in the Canadian Arctic region. They met as financial markets were roiled this week over fears that a European debt crisis could derail the global recovery. The Canadian finance minister also said the leaders discussed the debt problem in Greece – a possible precursor of what can happen in the U.S. Investors fear Greece may default or require a bailout from already strapped European governments. Those concerns are spreading to other financially troubled governments such as Portugal and Spain, and perhaps further down the road, the U.S. Canada, for its part, Flaherty noted, that the robust Canadian banking system does not need the fixes proposed by other countries, saying, “Canadians did not have to put taxpayers’ money into our financial institutions. We did not have to bail them out,” Flaherty said earlier this year, “It is a rather different situation in other jurisdictions, like the U.S.”

 The United States was represented by Treasury Secretary Timothy Geithner and Federal Reserve Chairman Ben Bernanke. The G-7 consists of the United States, Japan, Germany, Britain, France, Italy and Canada.  Geithner said that European officials “gave us a very comprehensive review” of the crisis in Greece. “They made it clear to us that they will manage this with great care,” Geithner told reporters.

The talks wrapped up on Saturday with discussions on the global economy, banking reform and Haiti, where the G-7 nations endorsed a U.S.-backed effort to get the International Monetary Fund and other lending agencies to grant temporary debt relief to Haiti as it struggles to recover from last month’s devastating earthquake.

Source: AP wire; Financial Post      Photos: Canadian Broadcasting Corp.