WORLD ECONOMY

At the end of the G20 last week, the leading group of nations said that the crisis in the global economy is far from over and more needs to be done to stimulate growth and create jobs around the world.

In a statement issued at the end of their summit in St Petersburg, Russia, G20 leaders welcomed a recovery in the developed world but warned of risks facing emerging markets.

The communique said:

… Despite our actions, the recovery is too weak, and risks remain tilted to the downside.

It listed ‘the main challenges’ facing the global economy, including ‘persistently high unemployment’ particularly among the young, financial stress in Europe and high levels of government debt.

The G20 also called for the withdrawal of emergency stimulus measures in countries such as the United States to be ‘carefully calibrated and clearly communicated’ to minimise volatility on the financial markets.

Speculation that the U.S. Federal Reserve is about to start reducing the level of support for the U.S. economy has plunged a number of emerging economies into turmoil.

The G20 is made up of developed countries and emerging markets accounting for 90 per cent of global output and two-thirds of the world’s population.