G 20 in Toronto
U.S. President Barack Obama, left, talks with Prime Minister Stephen Harper during the opening plenary session of the G20 Summit in Toronto on Sunday. (Jason Reed/Associated Press)
Prime Minister Stephen Harper used his opening address at Sunday's G20 meeting in Toronto to try to convince his fellow leaders that the fate of millions of people could suffer if they don't agree to cut deficits.
Arguing that the world economy remains fragile, Harper called on the G20 to take decisive action.
"We should agree that deficits should be halved by 2013, that government debt-to-GDP ratios should be stabilized by 2016 at least or put on a downward path," he said.
"We should agree to consider those targets as minimum."
A draft of the final communiqué, obtained by the CBC's senior business correspondent Amanda Lang, also contains other statements on the key issue facing the G20, an organization formed in 2008 to deal with the recession.
In his opening speech, Harper said the G20 needs to take decisive, co-ordinated and balanced action as the world economy struggles to return to growth.
"We need to send a clear message that as our stimulus plans expire we will focus on getting our fiscal houses in order," he said.
That issue is whether it's more important for countries to reduce their deficits by cutting spending — or if it's too early to trim government stimulus spending because the economic recovery is so weak.
U.S. President Barack Obama is in the latter camp. Some European countries, including Britain, are more concerned with avoiding a financial crisis brought on by too much government spending. The trouble facing Greece earlier this year, when it had to be bailed out because it was close to running out of money, concerns them.
'Whole world is watching'
If a government defaulted on its repayments, the whole financial structure could crash, some countries believe. But others fear that cutting the stimulus too soon could choke the recovery."The whole world is watching us because the fate of millions of people depends on our actions," Harper said, noting that failing to act could cost millions of jobs.
If the deficit-cutting idea survives in the final version of the document to be released Sunday, it would suggest the European countries have prevailed.
But Lang said the document recognizes that all countries are not in the same position, which means the policies could be tailored to each country's circumstances.
Tougher standards for banks are also on the G20 agenda.
The Canadian Press reported early Sunday that Canada had prevailed in its battle against a bank tax, which some countries had endorsed.
The final communiqué is expected to say countries should make sure taxpayers won't pay when banks fail.
Individual countries will be allowed to decide how to do that.
The G20 includes emerging economies like China, India and Brazil as well as the traditional European and North American leaders.
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