The 6th G20 (industrialist and developing countries) summit was held in Cannes, France on November 3 and 4, 2011 to discuss key issues in the global economy. Eurozone debt crisis dominated the Summit in Cannes. The other issues discussed in the summit were global imbalances, financial transactions tax, tax evasion and reform of the international monetary system.
Agreements made in G20 Cannes Summit:
• The G20 leaders’ affirmed their commitment to work together and took decisions to reinvigorate economic growth. They agreed to create jobs, ensure financial stability, promote social inclusion and make globalization serve the needs of the people.
• They agreed on an Action plan for Growth and Jobs to address short term vulnerabilities and strengthen medium-term foundations for growth.
• An affirmation was made on G20’s commitment to move more rapidly toward more market-determined exchange rate systems and enhance exchange rate flexibility to reflect underlying economic fundamentals, avoid persistent exchange rate misalignments and refrain from competitive devaluation of currencies.
• The leaders of G20 agreed to continue their efforts to further strengthen global financial safety nets. They committed to support the IMF in putting forward the new Precautionary and Liquidity Line (PLL) to provide on a case by case basis increased and more flexible short-term liquidity to countries with strong policies and fundamentals facing exogenous shocks.
• They supported the euro area's comprehensive plan and urged rapid elaboration and implementation, including of country reforms.
• Member countries decided to develop the regulation and oversight of shadow banking. They agreed on developing further their regulation on market integrity and efficiency, including addressing the risks posed by high frequency trading and dark liquidity.
• They determined to enhance the functioning and transparency of energy markets.
India pitched for a consensus among G-20 nations on sharing of tax and banking information with retrospective effect.
India stressed on the fact that the era of banking secrecy laws was over, and it was vital to build a consensus on sharing of past banking data as it would help in investigation of earlier cases of tax evasion.
The G20 summit in Cannes finally ended in ominous disarray. The leaders finally were unable to agree upon a boost to the International Monetary Fund (IMF) to help distressed countries. Debt-ridden Italy, was seen as the epicentre of the euro crisis, was forced to put its austerity programme under the fund's control. The UK showed focus on urging its European partners to make progress, and wished to continue support extra cash for the IMF.
What is the G-20:
G-20 is an abbreviated form of the Group of Twenty. It consists of 19 member countries and EU. G20 was established in 1999 to bring together systemically important industrialized and developing economies to discuss key issues in the global economy. The inaugural meeting of the G-20 took place in Berlin, on December 15-16, 1999, and it was hosted by German and Canadian finance ministers.
The G-20 was created as a response both to the financial crises of the late 1990s and to a growing recognition that key emerging-market countries were not adequately included in the core of global economic discussion and governance.
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