Ladies and Gentlemen, Distinguished Members of Press, good evening and welcome.
We have just completed the very first Ministers and Governors Meeting of G20 under the Turkish Presidency. We actually completed our meeting about one hour before the scheduled time mostly because our Deputies have done an excellent job of making the good work ahead of time and leave for us, for the Ministers and Governors not really a big debate at the end of the day.
So, as all the G20 meetings, we finalized our Communique with consensus of all the members of G20. It’s been a very productive meeting, a very good start out for an entire year.
I would like to express my sincere appreciation for all those who attended the meetings at different levels and we hope that by the end of this year, by Antalya Summit, Leaders’ Summit, we will be achieving quite a few of what we have planned and intended at the beginning.
We had quite a few agenda items. We started last night with an overall evaluation of the global economy and today we have focused on our growth strategies. Then we talked about the architecture of international financial system, mostly concentrated on IMF Quota and Governance Reform. Then our last two sessions were international tax issues and also financial regulation.
On the global economy, overall compared to the beginning of last year, 2014, we are not at a better position. Overall, there are better news, the outlook in some major advanced economies is now much better, compared to last year. The growth in countries like US and UK is much higher than it used to be. In the Euro-zone, in the European Union, unemployment stopped increasing and it is actually now in gradual decrease in the overall unemployment figures. Although the labor market both in the US and in the EU is probably still not improving in a high quality way. In Japan, maybe the initial results are showing us some different messages. Overall the outlook for Japan is positive.
Emerging economies, although the performance changes from one country to another, still the overall performance is good. Still a big percentage of the global growth, a big portion of global growth is coming from developing countries, from emerging economies. Maybe the performance changes again from one country to another, but on average the developing countries will have much higher growth rates compared to the developed countries.
Of course there are many risk areas, many subjects that we have to be very careful. There is still no room for complacency. Oil prices, the sharp decline in oil prices was quite a surprise. If last year, when asked to any analyst or any market player or any authority, government authority or an international organization that the oil prices could be halved in such a short time, probably many people wouldn’t have believed that. But it happened. This is a new set of circumstances now. Overall, the influence, the impact seems to be positive on the global economy but then there are significant variations from country to country and from region to region.
Recent monetary policy decisions in some advanced economies has been also a very important global agenda item. Deflationary pressures are weighing on some economies together with protracted demand weaknesses. And against this backdrop, we agreed that the current economic conditions require accommodative monetary policies is some economies. We also noted that some advanced economies with stronger growth prospects are closer to conditions that would allow for policy normalization. Of course in an environment of diverging monetary policy settings and rising financial market volatility, policy settings should be carefully calibrated and clearly communicated to minimize negative spillovers.
Early this morning, we had an extensive discussion on comprehensive growth strategies. As you all know, G20 countries make many commitments for structural reforms and macroeconomic policies, and IMF and OECD analyzed and concluded that if those are actually delivered, if the promises are actually kept and implemented, then we will reach an additional 2.1% of growth by the year 2018. So what we have discussed is that this year, the year of 2015, should be a year of implementation and we agreed to develop a robust monitoring framework to follow-up with the implementation.
Our discussions on investment and infrastructure were very lively and it is very pleasing that many G20 countries are very aware of the need to be more upbeat about investments. Investments don’t help economies just during the phase of investment expenditures, but also if the investment is a productive one, it helps a country for a long time. For those who do have the fiscal space, it is important to have a view to the investment programs about how to increase the quality and also maybe how to add some quantity. But then, during times of scarce public resources, during times of high budget deficits and high public debt, many countries are considering more how to involve more private resources into public infrastructure projects. Here public private partnership models are important to work on. How to standardize them? How to make them easier to understand for investors and how to bring more legal, financial, technical predictability so that private resources could be more mobilized towards PPP projects?
We also had an extensive discussion on equity based financing, asset based instruments like Sukuk. And many participants agreed that there is need for more thorough understanding of how those models can be used more extensively globally. Then we had a very candid discussion on international financial architecture. As you know, the IMF 2010 quota reform has been agreed on by all the G20 countries, but not only that; so far 146 countries have ratified the reform in their parliaments so there is a very strong sense of ownership and political will around the world to go ahead and complete the reform. And around the G-20 table, there is a strong will to complete as soon as possible and meanwhile, continue to study options in the meantime if there is a delay in the completion of the ratification process.
International tax issues, another important subject that is actually getting more and more owners around the world and the international tax session was important for us to note the recent progress made in the G20, OECD Base Erosion and Profit Shifting project, which is abbreviated as BEPS. These are mostly to prevent cross-border tax evasion and avoidance. 2015 will be a year that we have to achieve important steps on this agenda and we are also very happy to note that there are now more and more developing countries signing up to this study. On this issue, in the line with the priorities of our Presidency, the work of the OECD on SMEs, small to medium sized enterprises, and also taxation has been approved and supported by all the G20 membership.
Then we discussed on financial regulation. We agreed on the proposed financial regulation agenda of 2015, including the finalization of remaining major elements of the core reform areas. We agreed on the importance of timely, fully and consistent implementation of the agreed reforms in this area. We respect and appreciate the work of FSB, Financial Stability Board, in this area and we are also happy that the G20 membership has a very strong ownership of and the will for the implementation. Financial sector regulation is a very important area. Timely and smart regulation actually helps stronger stability around the world and when there is better stability, then there is more confidence, which ultimately helps growth.
Then we had a final discussion, a subject actually an agenda item which we attended towards the end of our discussions and that is combatting financing growth terrorism. I would like to emphasize that there is a strong resolve of G20 members against terrorism and I would like to take this opportunity again to offer our condolences over the murder of Japanese nationals by terrorist organizations and again I strongly condemn once again the terrorist attacks in Paris. As a country fighting against terrorism for a long period of time, we understand the grief that the countries have been going through. As a reflection of our mutual feelings against terrorism, we committed to deepen our cooperation on this front and urged all countries to speed-up their compliance with the relevant international standards, in particular, concerning the exchange of information and the freezing of terrorist assets.
Ladies and Gentlemen, this meeting overall, the G20 meeting that we have held, served as an important stepping stone towards forward. We have over the next 9 months until the Summit, many more meetings to come and this April, as the G20 Ministers and Governors, we are meeting again in Washington D.C. Then we will host the second Ministers and Governors Meeting in Turkey, in September, in Ankara and we will also have a working dinner in Peru-Lima, on the sidelines of World Bank – IMF Annual Meetings in that country. Then throughout this year, as I have briefly discussed today, we have other Ministerial Meetings; our Labor Ministers will meet, our Trade Ministers will meet and actually we are going to make in September the Labor Ministers meeting back to back with Ministers in charge of Finance. So that there is going to be an overlapping session and I think there is a big support, especially in the L20 community to have that meeting in that fashion. Our Tourism Ministers will meet, our Agricultural and Food Ministers will meet especially to discuss global food safety issues. Our Energy Ministers will meet for the first time. Among many issues, access for energy is going to be discussed and many of these actually falls into our priorities, the three Is of Turkish Presidency, which are Inclusiveness, Implementation and Investments.
Again thank you for your interest, thank you for standing two days with us here in this conference center and I hope that the meetings were also productive for you getting as much news as possible about what is going on in the global economic and financial agenda.