HUNTSVILLE, Ontario – World leaders gathered to deal with the aftermath of the global financial crisis, with United States President Barack Obama citing his country’s progress toward overhauling its banking system as he called for coordinating reforms throughout the world.An agreement reached by the United States lawmakers yesterday to overhaul the country’s financial system was certain to be a major discussion point over three days of talks in Canada.Leaders of the Group of Eight major industrial nations – the United States, Japan, Germany, France, Britain, Italy, Canada and Russia – were meeting yesterday at a resort north of Toronto in the Muskoka lakes region.Those discussions are to move back to Toronto today and tomorrow for talks with the larger Group of 20 major economies, which includes the rich countries and major developing nations such as China, Brazil and India.The G-20 group represents 85 per cent of the global economy. The United States wants it to endorse the outlines for global financial reform to eliminate the threat that banks facing tougher regulations in one jurisdiction would move their operations to countries with more lax rules.The G-20 countries have been trying for months to overcome differences on financial overhaul centred around setting tougher global standards for the amount of capital the major international banks must have to cushion against losses. Massive losses that began with subprime mortgages in the United States triggered a global meltdown in 2008.Obama’s push for international financial reform was bolstered by the agreement by United States lawmakers reconciling separate bills passed by the two chambers of Congress affecting a wide range of financial transactions. The agreement makes it likely the measure will become law within weeks.“We need to act in concert for a simple reason: This crisis proved and events continue to affirm that our national economies are inextricably linked,” Obama said on the White House lawn before leaving for Canada.Obama also pledged to promote economic growth, but is likely to encounter resistance from other leaders to his calls for continued stimulus spending to support the global economy.They were moving in the opposite direction to raise taxes and cut government programmes out of fears of a Greek-style debt crisis. Britain, Germany, France and Japan have all unveiled deficit-cutting plans. Canadian Prime Minister Stephen Harper was urging the countries to agree to concrete deficit-reduction goals as a way of restoring investor confidence following the turmoil caused by the Greek debt crisis. (AP)
