Canada's Harper says fiscal targets minimalist

Canada's Prime Minister Stephen Harper listens to a question during an interview with Reuters in the Langevin Block in Ottawa June 21, 2010.

OTTAWA (Reuters) - Canadian Prime Minister Stephen Harper told Reuters on Monday that the fiscal targets he has proposed to the G20 are "minimalist" and said countries would have to tread carefully to avoid choking off a global recovery.

Harper said countries should follow through on short-term stimulus but also have a plan for tackling sovereign debt in the medium term. The focus in both cases should be on fostering growth, he said.

"In the short term, we need to continue to deliver stimulus ... we are not suggesting the early or premature termination of that," he said in an interview.

"We're starting to see interest rates creep up in some countries, even a little bit in Canada, and that's a signal that people have to take a look at their debt stock. If your debt stock is enormous, even a small interest rate increase could have quite serious effects on growth," he said.

He also said the G20 leaders attending a summit in Toronto this week must send a clear message to markets they will meet self-imposed timelines for financial sector reform.

(Reporting by David Ljunggren and Louise Egan; editing by Rob Wilson)