"The recent volatility in financial markets reminds us that the global economy is still fragile and international cooperation is much needed," Dow Jones Newswires quoted the draft as saying."We remain in the constant state of alertness; closely monitoring the economy, continuously pursuing well-coordinated economic policies and standing ready to do whatever else is necessary to ensure global financial stability."The draft statement is to be completed by G20 finance ministers and central bankers when they meet Friday and Saturday in the South Korean city of Busan.It comes as the euro zone debt crisis threatens to derail a fragile global recovery, with nations trying to reduce massive budget deficits.Ahead of the meeting, the head of the International Monetary Fund, Dominique Strauss-Kahn, stressed the importance of dealing with euro zone debt problems that have roiled financial markets and sent the euro plunging."It will be important that emphasis is placed on stimulating growth. Without growth, the debt problems will be much more difficult to resolve, and fostering reforms that will help support growth will be key," he told Yonhap news agency.The G20 communique as quoted by Dow Jones Newswires does not indicate any agreement on the contentious issue of a bank levy to pay for future financial sector bailouts.The text merely says the G20 "agreed to develop, with input from the IMF a set of principles on how the financial sector could make a fair and substantial contribution" to the cost of cleaning up after financial crises.The levy is supported by European powers and the United States but resisted by some developing nations plus Canada and Australia, who argue that they should not have to pay to clear up a mess they did not create.With officials ruling out agreement in Busan on key financial and regulatory reforms, the need to strike the right balance between trimming deficits and sustaining economic growth will take center stage."Countries with high budget deficits need to make sure they can deal with those deficits," Britain's finance minister, George Osborne, said in Beijing before flying to Busan."Surplus countries also need to play their part contributing to global growth and that will be one of the big topics for discussion in South Korea," he said.On Wednesday US Treasury Secretary Timothy Geithner sought to prod economic powers toward a set of common financial rules, as he tries to prevent competing national rules from throwing up fresh trade barriers.Geithner said he wanted to "accelerate progress on reaching and putting in place global agreements on the core reforms."Geithner admitted agreement on some key reforms, including a global bank tax, would not come at this week's meeting but said differences were "narrowing."French Finance Minister Christine Lagarde brushed off concern in some G20 capitals that Germany is preparing fresh belt-tightening even though its deficit, while above 5 percent of GDP, is modest by European standards.Speaking to reporters in Paris on Wednesday, Lagarde said removal of the economic stimulus that governments put in place to combat recession was all a matter of "fine-tuning." But she added: "We need to be careful to avoid brutal shifts.”The draft communique also says that the crisis shows the "importance of sustainable public finances and the need for countries with serious fiscal challenges to expeditiously pursue credible, coordinated, growth-friendly and tailored fiscal consolidation."The meeting Friday and Saturday will prepare for a G20 summit in Toronto on June 26-27 of the top developed and developing nations.
