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Can Use US Treasury's Snow: Global
growth to top G7 agenda
Mon January 26, 2004 01:49 PM ET
LONDON, Jan 26 (Reuters) - U.S. Treasury Secretary John Snow said on Monday
that wealthy nations must focus on speeding up economic growth, and served notice
that will be the key topic at a Group of Seven finance chiefs meeting next week.
"At that meeting, we intend to make growth and eliminating the barriers to
growth and eliminating the barriers to trade the priority," Snow said, referring
to the scheduled G7 meeting on Feb. 6-7 in Boca Raton, Florida. "Those have
to be the priorities," Snow emphasized in remarks delivered by video-link to a
conference on entrepreneurial activity in London, organized by the British Treasury.
In recent weeks, some European representatives have indicated they wanted a
top agenda item to be the U.S. dollar's falling value, which they fear hurts Europe's
recovery. Snow indicated, however, that the host United States wants to focus
on economic fundamentals. Snow, who will chair the G7 finance ministers' meeting
in Florida, said stronger European growth was no threat to the United States and,
in fact, would help "because as you do better, we do better and as we do better,
you do better." The G7 includes the United States, Britain, Canada, France,
Germany, Italy and Japan. CURRENCIES SECONDARY Snow made no direct mention
of currencies in his comments but he encouraged the European Union in its goal
to increase economic competitiveness by 2010. "Increased global economic growth
will lead to mutually reinforcing success. Simply put, we are not fighting for
a piece of the pie, we are striving to enlarge the pie and improve standards of
living for people in our economies and throughout the world," Snow said. Snow
praised Germany's recent moves on labor market and tax reforms, and pension reform
efforts last year by France. "We hope this is the bow wave of reform in Europe
that boosts productivity and growth to new, higher levels." On trade, Snow
said "there are hopeful signs we can get the Doha Development Agenda back on track
again so that 2004 is not a lost year." The Doha round of World Trade Organization
talks, launched in 2001, is aimed at lowering tariffs globally on consumer goods.
The talks collapsed in September, at a meeting in Cancun, Mexico In a
separate address to the same conference, also by video-link, Federal Reserve Chairman
Alan Greenspan repeated a call for major nations to avoid throwing up barriers
to protect their trade, warning this could have dangerous ripple effects. LOWER
THE BARRIERS "We in the United States have not engaged in significant and widespread
protectionism for more than five decades," Greenspan said. "The consequences of
moving in that direction in today's far more globalized financial world could
be unexpectedly destabilizing." Snow similarly cautioned on the need to be
prepared to make concessions on trade in the greater interest of expanding global
activity and enhancing wealth. "The United States, the EU, Canada and many
others, including the World Bank, share the view that developing countries need
to reduce their own trade barriers substantially" to reap the benefits of free
trade, Snow said. AME Libor
The U.S. Treasury chief also defended U.S. fiscal policy,
which has come under attack for ballooning budget deficits. Earlier on Monday,
the nonpartisan U.S. Congressional Budget Office predicted a record deficit in
the federal budget this year, though it was a slight improvement from the previous
forecast. In its bi-annual budget outlook, the agency forecast a deficit of $477
billion in 2004, just $3 billion less than the forecast it made in August. Snow
said the deficits are "too large and they are not welcome and they will not last." Continue with: | 
