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G20 Summits> London Summit
G20 Analysis

The G20 London Summit Commitments

Compiled by Jenilee Guebert, G20 Research Group
Commitments contained in "Global Plan for Recovery and Reform,"
issued by the G20 leaders in London on April 2, 2009
Total number of commitments = 88

• Restoring growth and jobs
• Strengthening financial supervision and regulation
• Strengthening our global financial institutions
• Resisting protectionism and promoting global trade and investment
• Ensuring a fair and sustainable recovery for all
• Delivering our commitments

1. We have today therefore pledged to do whatever is necessary to: restore confidence, growth, and jobs;
   
   
2. [We have today therefore pledged to do whatever is necessary to:]repair the financial system to restore lending;
   
   
3. [We have today therefore pledged to do whatever is necessary to:] strengthen financial regulation to rebuild trust;
   
   
4. [We have today therefore pledged to do whatever is necessary to:] fund and reform our international financial institutions to overcome this crisis and prevent future ones;
   
   
5. [We have today therefore pledged to do whatever is necessary to:] promote global trade and investment and reject protectionism, to underpin prosperity;
   
   
6. [We have today therefore pledged to do whatever is necessary to:] build an inclusive, green, and sustainable recovery.
   
   
7. [We have agreed] to treble resources available to the IMF to $750 billion
   
   
8. [We have agreed] to support a new SDR allocation of $250 billion
   
   
9. [We have agreed] to support at least $100 billion of additional lending by the MDBs,
   
   
10. [We have agreed] to ensure $250 billion of support for trade finance
    
    
11. [We have agreed] to use the additional resources from agreed IMF gold sales for concessional finance for the poorest countries

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Restoring growth and jobs

12. We are undertaking an unprecedented and concerted fiscal expansion, which will save or create millions of jobs which would otherwise have been destroyed, and that will, by the end of next year, amount to $5 trillion
    
    
13. [We are undertaking an unprecedented and concerted fiscal expansion, which will save or create millions of jobs which would otherwise have been destroyed, and that will, by the end of next year,] raise output by 4 per cent
    
    
14. [We are undertaking an unprecedented and concerted fiscal expansion, which will save or create millions of jobs which would otherwise have been destroyed, and that will, by the end of next year,] and accelerate the transition to a green economy.
    
    
15. We are committed to deliver the scale of sustained fiscal effort necessary to restore growth.
    
    
16. our central banks have pledged to maintain expansionary policies for as long as needed and to use the full range of monetary policy instruments, including unconventional instruments, consistent with price stability.
    
    
17. We are committed to take all necessary actions to restore the normal flow of credit through the financial system and ensure the soundness of systemically important institutions, implementing our policies in line with the agreed G20 framework for restoring lending and repairing the financial sector.
    
    
18. We commit today to taking whatever action is necessary to secure that outcome [that world growth in real terms would resume and rise to over 2% by the end of 2010], and we call on the IMF to assess regularly the actions taken and the global actions required.
    
    
19. We are resolved to ensure long-term fiscal sustainability and price stability and will put in place credible exit strategies from the measures that need to be taken now to support the financial sector and restore global demand.
    
    
20. We will conduct all our economic policies cooperatively and responsibly with regard to the impact on other countries and will refrain from competitive devaluation of our currencies and promote a stable and well-functioning international monetary system.
    
    
21. We will support, now and in the future, to candid, even-handed, and independent IMF surveillance of our economies and financial sectors, of the impact of our policies on others, and of risks facing the global economy.

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Strengthening financial supervision and regulation

22. We will take action to build a stronger, more globally consistent, supervisory and regulatory framework for the future financial sector, which will support sustainable global growth and serve the needs of business and citizens.
    
    
23. We each agree to ensure our domestic regulatory systems are strong.
    
    
24. But we also agree to establish the much greater consistency and systematic cooperation between countries, and the framework of internationally agreed high standards, that a global financial system requires.
    
    
25. Strengthened regulation and supervision must promote propriety, integrity and transparency;
    
    
26. [Strengthened regulation and supervision must] guard against risk across the financial system;
    
    
27. [Strengthened regulation and supervision must] dampen rather than amplify the financial and economic cycle;
    
    
28. [Strengthened regulation and supervision must] reduce reliance on inappropriately risky sources of financing;
    
    
29. [Strengthened regulation and supervision must] discourage excessive risk-taking.
    
    
30. Regulators and supervisors must protect consumers and investors,
    
    
31. [Regulators and supervisors must] support market discipline,
    
    
32. [Regulators and supervisors must] avoid adverse impacts on other countries,
    
    
33. [Regulators and supervisors must] reduce the scope for regulatory arbitrage,
    
    
34. [Regulators and supervisors must] support competition and dynamism
    
    
35. [Regulators and supervisors must] keep pace with innovation in the marketplace.
    
    
36. To this end we are implementing the Action Plan agreed at our last meeting, as set out in the attached progress report.
    
    
37. We agree: to establish a new Financial Stability Board (FSB) with a strengthened mandate, as a successor to the Financial Stability Forum (FSF), including all G20 countries, FSF members, Spain, and the European Commission;
    
    
38. [We agree:] that the FSB should collaborate with the IMF to provide early warning of macroeconomic and financial risks and the actions needed to address them;
    
    
39. [We agree:] to reshape our regulatory systems so that our authorities are able to identify and take account of macro-prudential risks;
    
    
40. [We agree:] to extend regulation and oversight to all systemically important financial institutions, instruments and markets. This will include, for the first time, systemically important hedge funds;
    
    
41. [We agree:] to endorse and implement the FSF’s tough new principles on pay and compensation and to support sustainable compensation schemes and the corporate social responsibility of all firms;
    
    
42. [We agree:] to take action, once recovery is assured, to improve the quality, quantity, and international consistency of capital in the banking system.
    
    
43. In future, regulation must prevent excessive leverage and require buffers of resources to be built up in good times;
    
    
44. [We agree:] to take action against non-cooperative jurisdictions, including tax havens.
    
    
45. [We agree:] to call on the accounting standard setters to work urgently with supervisors and regulators to improve standards on valuation and provisioning and achieve a single set of high-quality global accounting standards;
    
    
46. [We agree:] to extend regulatory oversight and registration to Credit Rating Agencies to ensure they meet the international code of good practice, particularly to prevent unacceptable conflicts of interest.

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Strengthening our global financial institutions

47. We have therefore agreed today to make available an additional $850 billion of resources through the global financial institutions to support growth in emerging market and developing countries by helping to finance counter-cyclical spending, bank recapitalisation, infrastructure, trade finance, balance of payments support, debt rollover, and social support.
    
    
48. we have agreed to increase the resources available to the IMF through immediate financing from members of $250 billion, subsequently incorporated into an expanded and more flexible New Arrangements to Borrow, increased by up to $500 billion, and to consider market borrowing if necessary;
    
    
49. we support a substantial increase in lending of at least $100 billion by the Multilateral Development Banks (MDBs), including to low income countries, and ensure that all MDBs have the appropriate capital.
    
    
50. We have agreed to support a general SDR allocation which will inject $250 billion into the world economy and increase global liquidity,
    
    
51. [We have agree to support] urgent ratification of the Fourth Amendment.
    
    
52. we are determined to reform and modernise the international financial institutions to ensure they can assist members and shareholders effectively in the new challenges they face.
    
    
53. We will reform their mandates, scope and governance to reflect changes in the world economy and the new challenges of globalisation, and that emerging and developing economies, including the poorest, must have greater voice and representation.
    
    
54. This [reforming the international financial institutions’ mandates, scope and governance to reflect changes in the world economy and the new challenges of globalisation] must be accompanied by action to increase the credibility and accountability of the institutions through better strategic oversight and decision making.
    
    
55. we commit to implementing the package of IMF quota and voice reforms agreed in April 2008
    
    
56. we agree that, alongside this, consideration should be given to greater involvement of the Fund’s Governors in providing strategic direction to the IMF and increasing its accountability;
    
    
57. we commit to implementing the World Bank reforms agreed in October 2008.
    
    
58. we agree that the heads and senior leadership of the international financial institutions should be appointed through an open, transparent, and merit-based selection process;
    
    
59. building on the current reviews of the IMF and World Bank we asked the Chairman, working with the G20 Finance Ministers, to consult widely in an inclusive process and report back to the next meeting with proposals for further reforms to improve the responsiveness and adaptability of the IFIs.
    
    
60. we agreed on the desirability of a new global consensus on the key values and principles that will promote sustainable economic activity. We support discussion on such a charter for sustainable economic activity with a view to further discussion at our next meeting.

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Resisting protectionism and promoting global trade and investment

61. We will not repeat the historic mistakes of protectionism of previous eras.
    
    
62. we reaffirm the commitment made in Washington: to refrain from raising new barriers to investment or to trade in goods and services,
    
    
63. [we reaffirm the commitment made in Washington: to refrain from] imposing new export restrictions,
    
    
64. [we reaffirm the commitment made in Washington: to refrain from] implementing World Trade Organisation (WTO) inconsistent measures to stimulate exports.
    
    
65. In addition we will rectify promptly any such measures.
    
    
66. We extend this pledge to the end of 2010;
    
    
67. we will minimise any negative impact on trade and investment of our domestic policy actions including fiscal policy and action in support of the financial sector.
    
    
68. We will not retreat into financial protectionism, particularly measures that constrain worldwide capital flows, especially to developing countries;
    
    
69. we will notify promptly the WTO of any such measures and we call on the WTO, together with other international bodies, within their respective mandates, to monitor and report publicly on our adherence to these undertakings on a quarterly basis;
    
    
70. we will take, at the same time, whatever steps we can to promote and facilitate trade and investment; and
    
    
71. we will ensure availability of at least $250 billion over the next two years to support trade finance through our export credit and investment agencies and through the MDBs.
    
    
72. We remain committed to reaching an ambitious and balanced conclusion to the Doha Development Round, which is urgently needed.
    
    
73. To achieve this we are committed to building on the progress already made, including with regard to modalities.
    
    
74. We will give renewed focus and political attention to this critical issue in the coming period and will use our continuing work and all international meetings that are relevant to drive progress.

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Ensuring a fair and sustainable recovery for all

75. we reaffirm our historic commitment to meeting the Millennium Development Goals
    
    
76. [we reaffirm our historic commitment] to achieving our respective ODA pledges, including commitments on Aid for Trade, debt relief, and the Gleneagles commitments, especially to sub-Saharan Africa;
    
    
77. the actions and decisions we have taken today will provide $50 billion to support social protection, boost trade and safeguard development in low income countries, as part of the significant increase in crisis support for these and other developing countries and emerging markets;
    
    
78. we are making available resources for social protection for the poorest countries, including through investing in long-term food security and through voluntary bilateral contributions to the World Bank’s Vulnerability Framework, including the Infrastructure Crisis Facility, and the Rapid Social Response Fund;
    
    
79. we have committed, consistent with the new income model, that additional resources from agreed sales of IMF gold will be used, together with surplus income, to provide $6 billion additional concessional and flexible finance for the poorest countries over the next 2 to 3 years.
    
    
80. we have agreed to review the flexibility of the Debt Sustainability Framework and call on the IMF and World Bank to report to the IMFC and Development Committee at the Annual Meetings; and
    
    
81. We commit to support those affected by the crisis by creating employment opportunities and through income support measures.
    
    
82. We will build a fair and family-friendly labour market for both women and men.
    
    
83. We will support employment by stimulating growth, investing in education and training, and through active labour market policies, focusing on the most vulnerable.
    
    
84. We agreed to make the best possible use of investment funded by fiscal stimulus programmes towards the goal of building a resilient, sustainable, and green recovery.
    
    
85. We will make the transition towards clean, innovative, resource efficient, low carbon technologies and infrastructure.
    
    
86. We will identify and work together on further measures to build sustainable economies.
    
    
87. We reaffirm our commitment to address the threat of irreversible climate change, based on the principle of common but differentiated responsibilities, and to reach agreement at the UN Climate Change conference in Copenhagen in December 2009.

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Delivering our commitments

88. We agreed to meet again before the end of this year to review progress on our commitments.

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