Treasurer Joe Hockey has got an agreement on one of his key aims at the Group of 20 finance ministers meeting – a growth boost for the next five years.
The Group of 20 has struck a landmark deal to lift global economic activity by $US2 trillion ($A2.2 trillion) over the next five years, that could create tens of millions of jobs across the globe.
Federal Treasurer Joe Hockey, hosting the first G20 meeting of Australia’s 2014 presidency, said finance ministers from the world’s top economies had taken a major step.
“We all know the challenges that lie ahead but now’s the time to go for growth,” he said.
Handing down the G20’s final communique after a weekend of talks, Mr Hockey said the forum wanted to lift collective growth by more than two per cent above current trajectory over the next five years.
The International Monetary Fund (IMF) is forecasting global growth of 3.7 per cent this year and four per cent next year.
“Concrete actions across the G20 can turn this objective into a reality,” Mr Hockey told reporters in Sydney on Sunday.
“We have to earn economic growth collectively. We can’t expect that easy monetary policy is going to generate sustainable economic growth.”
IMF chief Christine Lagarde applauded the agreement, saying the Washington-based institution’s own analysis showed the goal was attainable.
G20 members will take their separate growth plans to the Leaders Summit in Brisbane in November
For Australia’s part, Mr Hockey stressed unless it undertakes structural reforms and implements the promises the coalition government took to last year’s election it will fail to grow the economy.
“More importantly … we will be letting people down who want jobs,” he said.
Australian shadow treasurer Chris Bowen welcomed the G20 meeting outcome.
But there was no point in Mr Hockey talking about growth when he was planning to roll out a budget which did the “exact reverse”.
“The record of this government on these issues to date has been appalling,” he told AAP.
Mr Hockey will deliver his first budget in May and it’s likely to propose tough measures to reign in the budget deficit.
The G20 also struck an agreement to foster greater private sector investment, particularly for productivity-boosting infrastructure.
Mr Hockey hosted a dinner for the high powered G20 finance ministers on Saturday night and there was a lot of discussion about infrastructure.
“A lot of us didn’t realise we had quite common challenges in relation to infrastructure, finance and contraction,” he told reporters.
While there is “no silver bullet”, there was a recognition there was a lot of private money around the world ready to go into building new facilities.
However, Mr Hockey was deeply disappointed the meeting wasn’t able to move forward on IMF reforms that have on the agenda since 2010.
He urged the US to ratify reforms currently on the table to give developing countries a greater say in international developments. Progress will be reviewed at the next G20 meeting in Washington in April.
The Sydney meeting did make progress on reforms on international taxation to ensure global companies pay governments their fair share of tax, which will be taken to the G20 meeting in November.
Financial system reforms, set after the 2008-2009 global financial crisis, giving financial markets more certainty are also due to be completed by then.