U.S. calls on world leaders to focus on global demand
By Jason Lange
WASHINGTON (Reuters) - The United States on Friday forcefully called on world leaders to boost demand in the global economy, calling on countries with strong economies and budget positions to do more to help growth.
"Weak demand growth is the principal culprit for chronic economic under-performance from many countries," U.S. Treasury Secretary Jack Lew said in a statement prepared for delivery to the International Monetary Fund's steering committee.
"It is especially incumbent upon countries with external surpluses and fiscal flexibility to bolster their support for global adjustment," he said in an apparent reference to Germany, Europe's largest surplus economy.
Washington has been pressing Germany to do more to help the euro zone emerge from its deep economic crisis, but Berlin has resisted calls that it spend more freely.
Lew said European counties also need to boost the productivity of their economies, a policy option Germany favours over fiscal stimulus.
"Demand and structural supply side reforms should go hand-in-hand to catalyze stronger growth," he said of Europe.
In the statement, Lew also called on the world's biggest economies to hold to their commitments to avoid competitive devaluations of their currencies.
(Reporting by Jason Lange)
