G20 promises more steps to boost global GDP by USD 2 trillion

G20, a grouping of developed and developing nations, today vowed to take more measures to push the global GDP by an additional 2 per cent, or over USD 2 trillion, by 2018.

Although as per the IMF-OECD estimates, an incremental growth of 1.8 per cent in global GDP is achievable, pushing it up by 2 per cent would require additional efforts.

"In the lead up to the Brisbane Summit, we will continue to identify a series of additional measures to meet our collective growth ambition. We will hold each other to account in implementing these policy commitments," said a communique issued after the meeting of the G20 Finance Ministers and central bank governors.

The G20 meeting here will be followed by a summit in Brisbane in November. The G-20 represents about 85 percent of the global economy. Minister of State for Finance Nirmala Sitharaman, who is representing India at the G20 meeting, told AFP: "At the moment, on the two per cent requirement, it is broadly understood that about a 1.8 per cent level is already achievable".

"It is only the balance on which a little more additional push is required and if I go by Saturday's discussion, most of them did agree, and most of them felt committed to giving that additional push, so the additional two percent should be achievable," she added.

As per the update to its World Economic Outlook report, the IMF in July said the global economy would expand 3.4 per cent in 2014 and improve to 4 per cent next year.

The G20 said structural reforms will be important to speed up growth by additional 2 per cent. "We have developed a set of new concrete measures that will facilitate growth, increase and foster better quality investment, lift employment and participation, enhance trade and promote competition," it said.

Preliminary analysis by IMF-OECD indicates these measures will lift our collective GDP by an additional 1.8 per cent through to 2018, it added. "These measures, along with macroeconomic policies, are designed to lift global growth and contribute to rebalancing global demand. Implementation of these measures is also essential to foster private sector growth, to give our citizens more opportunities to improve their living standards," it added.

The communique also expressed concern over the uneven global economic growth and said it remains below the pace required to adequately generate much needed jobs.

"Downside risks persist, including in financial markets and from geopolitical tensions. The global economy still faces persistent weaknesses in demand, and supply side constraints hamper growth. We need strong, sustainable and balanced growth and robust financial sectors to safeguard our economies from these risks and put people into jobs," it added.  On the quota and governance reforms at the International Monetary Fund (IMF), the communique said it remains a "key priority" for the G20 nations and are committed to maintaining a strong and adequately resourced IMF.

"We continue to urge the US to ratify the reforms agreed to in 2010 by year-end and reaffirm our Leaders’ agreement in St Petersburg and our agreement in April 2014," it added.

The IMF quota reforms, which seek to increase the voting share of emerging economies including India, had hit a roadblock with the US Congress failing to agree on a new funding mechanism for the multilateral body.

The emerging counties, like India, China, Brazil and Russia, has been asking for increased voting rights in IMF, which would reflect their growing share in world economy.

The quota reform once implemented will increase India's voting share from thecurrent 2.44 per cent to 2.75 percent, following which the country will become the eighth largest quota holder at the IMF, up from the 11th position.