The West

G20 expresses growth fears
G20 expresses growth fears

G20 powers warn possible delays in Europe's anti-crisis measures and a potential sharp fiscal tightening in the United States threaten global growth.

"Global growth remains modest and downside risks are still elevated, including due to possible delays in the complex implementation of recent policy announcements in Europe, a potential sharp fiscal tightening in the United States, securing funding for this year's budget in Japan," Group of 20 finance chiefs said in a statement overnight, after a two-day meeting in Mexico City.

The communique also cited "weaker growth" in some emerging nations and "additional supply shocks" in some commodity markets as threats to the world economy.

The eurozone debt crisis and a looming US "fiscal cliff" were the focal points during two days of talks among finance ministers and central bankers from the Group of 20 leading developed and emerging economies.

The United States faces automatic spending cuts and tax hikes in January that could harm the US economy and global growth unless the White House and Congress reach a compromise before then.

"The United States will carefully calibrate the pace of fiscal tightening to ensure that public finances are placed on a sustainable long-run path while avoiding a sharp fiscal contraction in 2013," the G20 statement said.

But G20 officials acknowledged that any resolution to the fiscal cliff will have to wait until after Tuesday's US presidential election, with incumbent Barack Obama facing a tight race with Republican rival Mitt Romney.

The West Australian

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