* G20 aims to expand GDP by extra 2 pct over 5 years
* Growth to come via structural reforms, to be agreed on by
* Emerging nations get a nod on calls for central bank
By Louise Egan and Jan Strupczewski
SYDNEY, Feb 23 The world's top economies have
embraced a goal of generating more than $2 trillion in
additional output over five years while creating tens of million
of new jobs, signalling optimism that the worst of crisis-era
austerity was behind them.
The final communique from the two-day meeting of Group 20
finance ministers and central bankers in Sydney said they would
take concrete action to increase investment and employment,
among other reforms. The group accounts for around 85 percent of
the global economy.
"We will develop ambitious but realistic policies with the
aim to lift our collective GDP by more than 2 percent above the
trajectory implied by current policies over the coming 5 years,"
the G20 statement said.
Australian Treasurer Joe Hockey, who hosted the meeting,
sold the plan as a new day for cooperation in the G20.
"We are putting a number to it for the first time -- putting
a real number to what we are trying to achieve," Hockey told a
news conference. "We want to add over $2 trillion more in
economic activity and tens of millions of new jobs."
The targeted acceleration would boost global output by more
than the world's eight largest economy Russia produces in a
The deal was also something of a feather in the cap of
Hockey, who spearheaded the push for growth in the face of some
scepticism, notably from Germany.
"What growth rates can be achieved is a result of a very
complicated process," Germany's Finance Minister Wolfgang
Schaeuble said after the meeting.
"The results of this process cannot be guaranteed by
Australia is acting as president of the G20 this year,
following Russia in 2013 and ahead of Turkey next year.
While shifting the focus to reforms that would lift and
sustain global growth in years to come the group acknowledged
that monetary policy would need to "remain accommodative in many
advanced economies and should normalise in due course."
The growth plan borrows wholesale from an IMF paper prepared
for the Sydney meeting, which estimated that structural reforms
would raise world economic output by about 0.5 percent per year
over the next five years, boosting global output by $2.25
The IMF has forecast global growth of 3.75 percent for this
year and 4 percent in 2015.
As yet there was no road map on how nations intend to get
there or repercussions if they never arrive. The aim was to come
up with the goal now, then have each country develop an action
plan and a growth strategy for delivery at a November summit of
G20 leaders in Brisbane.
"Each country will bring its own plan for economic growth,"
said Hockey. "Each country has to do the heavy lifting."
Agreeing on any goal is a step forward for the group that
has failed in the past to agree on fiscal and current account
targets. And it was a sea change from recent meetings where the
debate was still on where their focus should lie: on growth or
Financial markets had been wary of the possibility of
friction between advanced and emerging economies, but nothing
suggested the meeting would cause ripples on Monday.
"The text of the communique indicates that the standard U.S.
line that what is good for the core of the world economy is good
for all seems to have won out," said Huw McKay, a senior
economist at Westpac, noting there was nothing that could be
taken as "inflammatory" about recent volatility in markets.
YELLEN MINDFUL ON TAPERING
There was a nod to concerns by emerging nations that the
Federal Reserve consider the impact of its policy tapering,
which has led to bouts of capital flight from some of the more
"All our central banks maintain their commitment that
monetary policy settings will continue to be carefully
calibrated and clearly communicated, in the context of ongoing
exchange of information and being mindful of impacts on the
global economy," the communique read.
There was never much expectation the Fed would consider
actually slowing the pace of tapering, but its emerging peers
had at least hoped for more cooperation on policy.
Hockey said there had been honest discussions among members
on the impact of tapering and that newly installed Fed Chair
Janet Yellen was "hugely impressive" when dealing with them.
The G20 also stated that it "deeply regrets" that progress
on giving emerging nations more say in the International
Monetary Fund had stalled.
Major emerging powers including India, China, Brazil and
Russia, have long lobbied for increased voting power in the IMF
to reflect their growing share of the world economy, but the
changes agreed in 2010 have been blocked by the U.S. Congress.
The G20 urged the United States to ratify the reforms before
the next meeting of policy makers in April.
The group is also progressing with plans to "make sure
multinational companies pay their fair share," said U.S.
Treasury Secretary Jack Lew.
Big budget deficits and revelations that companies such as
Apple and Google use structures that lawmakers
have labeled "contrived" to avoid billions of dollars in taxes,
have led to growing calls to close corporate tax loopholes. The
companies say they follow the existing tax rules.