G20 - Taking all necessary action

The London summit 2009

Action is required around the world to: avoid a severe and protracted recession, guard against deflation, strengthen the financial sector and forestall pressure for protectionist policies that will damage every country.

Action is required around the world to:

* avoid a severe and protracted recession;
* guard against deflation;
* strengthen the financial sector and mitigate the decline in investment and the risks of financial isolationism, as foreign-owned banks withdraw lending or return it to their home markets; and
* forestall the pressure for protectionist policies that will damage every country.

Policy measures to date have avoided the collapse of the financial system and are already playing a useful role in supporting demand, countries will want to monitor conditions in the real economy and consider what further action may be warranted.
The macrofinancial response

Further steps are required to stimulate global demand. At the London Summit, world leaders will:

* review the following: the global impact of the financial crisis and whether further action may be warranted; how to ensure that the imperative to boost demand immediately is consistent with the need for long-term fiscal sustainability; and how to maintain levels of public investment, both in physical and human capital;
* reaffirm their commitment to price stability and to avoiding deflation, and support central banks to continue to take the necessary monetary policy measures; and
* reaffirm their determination to take whatever action is necessary to ensure the stability of the global financial system, including immediate action to support lending, and considering the case for cooperation on dealing with impaired assets.