US Proposes G20 Emergency Meeting on Global Crisis

The Group of 20 advanced and emerging countries will hold an emergency meeting on the global financial crisis at the request of the United States.

U.S. President George W. Bush, German Chancellor Angela Merkel and Brazilian President Luiz Inacio Lula da Silva agreed to hold a special G20 meeting over the telephone yesterday, The Associated Press said.

The talks are expected to be held alongside the annual meetings of the World Bank and International Monetary Fund set in Washington from Friday through Monday.

The G20 members include the European Central Bank, G8 countries (seven advanced economies and Russia) and Korea, Argentina, Australia, Brazil, China, India, Indonesia, Mexico, Saudi Arabia, South Africa and Turkey.

Experts said Washington proposed the G20 meeting because it believes the effort among G7 countries is insufficient to overcome the financial crisis now spreading all over the world.

To overcome the financial turmoil, the U.S. government is considering injecting public funds to major banks and partially nationalizing them, according to The New York Times.

The bailout plan, which was passed by Congress last week, allows the government to buy preferred stocks of financial companies instead of bad assets. Washington, however, has been reluctant to purchase bank shares.

U.S. Treasury Secretary Henry Paulson also did not rule out nationalizing major banks like Britain did.

“We will use all of the tools we’ve been given to maximum effectiveness, including strengthening the capitalization of financial institutions of every size,” he said.

higgledy@donga.com