Why G20 shows up vital amid global financial crisis

WASHINGTON, Oct. 11 (Xinhua) -- Among international organizations, the Group of 20 (G20) does not usually draw people's attention. However, the current devastating global financial crisis has pushed the bloc to the front, making it an important forum for developed and developing countries to join hands to prevent the global economy from meltdown.

Along the deepening of the world financial crisis, most financial institutions in rich nations including the U.S. have slumped into credit crunch. To curb further bankruptcies, restore operation in credit markets and prevent a possible recession, developed nations need plenty of money to put into the market to restore confidence. The rich savings and ample foreign exchange reserves of emerging countries will be their rescue.

US Federal Reserve Bank Chairman Ben Bernanke (2nd L), Treasury Secretary Henry Paulson (3rd L) and President George W. Bush (C) sit down to a G-20 Ministerial Meeting led by Brazil's Finance Minister Guido Mantega (2nd R) and Central Bank President Henrique Meirelles (R) at IMF Headquarters in Washington, October 11, 2008.

The crisis, originally stemmed from the sub-prime mortgage crisis in the United States, quickly spreads to Europe, and now to the rest of the world. World leaders, finance ministers, chiefs of central banks attending the annual meeting of the 185-member International Monetary Fund (IMF) all agreed that the crisis is now global, and there had to be international cooperation to bring the disaster under control.

The G20, a bloc bringing together wealthy and emerging economies that together account for 85 percent of the world's economy, thus becomes vital for world leaders to discuss coordination in the world scope to tackle this global issue.

For the first time, U.S. President George W. Bush attended the G20 meeting on Saturday to address the financial crisis. He said earlier Saturday that the world's richest economies were united on a "serious global response" to the financial meltdown.

"We will stand together in addressing this threat to our prosperity. We will do what it takes to resolve this crisis. And the world's economy will emerge stronger as a result," he said.

Bush's attendance showed the U.S. awareness of the fact that it needs to cooperate with both developed and emerging countries to get over the current crisis, as it has spilled over the world.

US President George W. Bush (R) and Treasury Secretary Henry Paulson sit down to a G-20 Ministerial Meeting at the IMF Headquarters in Washington, October 11, 2008.

Developing nations are also aware of the interdependence among all nations in this globalization era. If wealthy countries slump into recession, there is no way developing nations wouldn't be dragged into the mire. It's of all nations' common interest to take coordinated measures to tackle the paramount challenge for the time being.

With the consensus, G7 (Group of Seven leading economies) and G20 leaders all pledged to use all economic and financial tools to "assure the stability and well functioning of financial markets."

The G20 endorsed a five-point action plan adopted by the G7. They also agreed to ensure that measures taken to ease the crisis "are closely communicated so that the action of one country does not come at the expense of others or the stability of the system as a whole," said a statement after the G20 meeting on Saturday.

Yi Gang, deputy governor of the People's Bank of China, told the IMF annual meeting that China was willing to strengthen coordination with other nations, and hoped all countries could make concerted efforts to protect the stability of the international financial market.

The financial crisis has changed the world. It has also stimulated reflection. As a bloc grouping major developed and emerging nations, the G20 is bound to play an unprecedented role dealing with this crisis and establishing a new international economic and financial system.