* Hockey seeks measurable growth objectives, clear
communication at G20
* Says Fed needs to be aware of the global impact of
* Regulation, tax minimisation also on agenda
By Ian Chua
SYDNEY, Feb 20 Australia will champion the
causes of emerging markets during its presidency of the G20,
calling for concrete global growth goals, a re-starting of
reforms to international bodies, and for the U.S. Fed to
consider the wider impact of its stimulus taper.
Ahead of the weekend meeting of finance ministers and
central bankers from the Group of 20 developed and emerging
economies, Treasurer Joe Hockey on Thursday outlined a wish list
that included tackling international tax-minimisation practices.
"We must at all times fully explain our actions to each
other and to the public, because clear communication, along with
information sharing, is the very essence of macroeconomic
coordination," Hockey told the Institute of International
Finance in Sydney.
"At the moment, macroeconomic coordination is being talked
about in the context of the U.S. Federal Reserve's gradual
tapering of its asset-purchase program."
The Fed needed to be aware of the international impact of
its tapering, and factor that into its actions, he said.
His comments came after the International Monetary Fund
advised advanced economies, including the United States, to
avoid pulling back stimulus too quickly given the weak global
Mike Callaghan, director of G20 Studies Centre at the Lowy
Institute for International Policy, hoped the global impact of
the Fed's tapering would be discussed, but added that he was not
expecting any major outcomes at this weekend's meetings.
"At the moment, the approach taken by the U.S. and U.S. Fed
is that they set monetary policy on the basis of the U.S.
economy, full stop," he said.
"It would be good to see some recognition that its handling
of this will have an impact on the rest of the world."
Hockey reiterated calls for the G20 to set global growth
objectives and deliver on them.
"I think there would be value in setting out in concrete and
measurable terms the objectives we are aiming for. We shouldn't
talk in generalities about growth but should communicate our
intentions to lift growth," he said.
Such proposals have drawn scepticism, with a German
government source criticising the idea as a "slightly antiquated
form for economic planning".
Hockey also said it was vital to complete the IMF governance
and quota reform, which would give emerging powers such as
China, India and Brazil a greater voice in the IMF. The plan has
stalled because of the United States' failure to ratify it,
annoying much of the developing world.
"Most importantly, the International Monetary Fund has a
role to play as a credible, effective and legitimate lender of
last resort," Hockey said.
"This is one of many reasons why completing the IMF
governance and quota reform is so important - and why I, as
chair of the G20 Finance process, will be devoting considerable
effort to trying to move this forward."
On financial regulation, Hockey said significant progress
has been made, but warned about over-reaching.
"The focus shouldn't be about constantly adding to the
regulation agenda. More regulation should be cast aside in
favour of better regulation."
Hockey noted that the global taxation system has not kept
pace with changes in the business world, a major issue for
cash-strapped governments around the world.
"As a consequence, we have seen the erosion of domestic tax
bases resulting from international tax planning that takes
advantage of the gaps in our current taxation systems," he said.
"The G20 will work this year towards these changes to make
sure our tax systems keep pace with the changing ways people do