WASHINGTON (Reuters) - U.S. Treasury Secretary Timothy Geithner said on Wednesday that the Group of 20 nations need to boost spending for as long as necessary to counter a severe financial crisis and a “deepening” global recession.
“We believe it is important for G20 nations to commit to substantial and sustained actions for a period that matches the likely duration of the crisis,” Geithner told reporters ahead of a weekend meeting in southeast Britain of finance ministers from the G20 rich and developing nations.
He said it was also vital to take decisive actions to strengthen the financial regulatory system and pledged to lay out more details of U.S. actions before another G20 gathering in April where political leaders will try to agree on how to bring a global recession to an end.
“There has been a lot of talk of reform. Now is the time for action,” Geithner said, adding that the G20 must work together to restore global growth.
“We must at the same time build a strong supervisory and financial regulatory framework for the future to ensure no such crisis occurs again,” he added.
The U.S. Treasury chief said efforts from other nations are critical to ensure the world’s largest economy gets back on track as American “jobs and the health of the U.S. economy are inextricably linked to the health and stability of the global economy.”
He also said the G20 and world’s international financial institutions, including the International Monetary Fund, have an obligation to help emerging markets and developing economies weather the storm.
“The G20 should support substantially increasing IMF resources through a significant expansion of the New Arrangements to Borrow ... (which) could be increased by up to $500 billion,” he said.
Reporting by Glenn Somerville and Corbett B. Daly, Editing by Chizu Nomiyama