LONDON — Prime Minister Stephen Harper hailed Thursday the G20's $1.1 trillion injection into the world economy as an unprecedented and remarkable step in the battle against the global recession.
"I don't think we're going to turn the corner on this recession tomorrow, but I do think markets can rest assured," Harper said after the London meetings. "The worst aspects of instability, I do believe, are behind us."
Markets in Canada closed Thursday at a three-month high, and trading in Britain and the U.S. was also up following news of the G20 injection of $1.1 trillion to rescue the world economy, including a tripling of funds to the International Monetary Fund to $750 billion to help developing countries.
Harper cautioned against rosy predictions, but nonetheless said the measures from the London summit would "bear fruit" and improve confidence in the markets. He said that although the recession remained deep, the "free fall" of global financial markets that was seen when the G20 last met in Washington in November has been contained.
Canada agreed to contribute $12 billion into the International Monetary Fund to assist developing countries coping with the downturn, nearly doubling Canada's previous contribution.
That was Canada's pledge toward the massive G20 plan to triple IMF spending with a guarantee of an additional $500 billion toward $750 billion to help struggling poorer countries.
Harper said the "large sums" being pledged were also recognition of the need to preserve stability in poorer countries, where the recession could have deeper and more serious effects.
"We all understand that you go from a market crisis to a financial crisis to an unemployment crisis, the real risk is crises of international peace and stability," Harper said.
The summit's host, British Prime Minister Gordon Brown, echoed that assessment.
"We have maintained our commitment to help the world's poorest and we have put more money aside for that also for a green recovery," said Brown.
Brown said that in addition to stimulating growth and global trade, the plan also cracked down on tax havens and hedge funds, while setting up a new international oversight body, a Financial Stability Board, to serve as an early warning system for future crises.
Harper, Brown and U.S. President Barack Obama — making his international debut — lauded the speed and decisiveness of their action, saying it was years ahead of the measures taken after the Great Depression.
"We finished a very productive summit that will be, I believe, a turning point in our pursuit of global economic recovery," Obama said.
"By any measure the London summit was historic," he added, saying the outcome represented "unprecedented steps to restore growth and prevent a crisis like this from happening again."
The leaders played down differences they had coming into the summit.
Obama acknowledged critics who have blamed the U.S. for the crisis by turning a blind eye to $$$$$ on Wall Street.
"It's hard to deny that some of the contagion did start on Wall Street," Obama said.
Striking a more conciliatory and multilateral tone than his predecessor George W. Bush, Obama said the U.S. was more interested in "forging a consensus instead of dictating our terms," suggesting that the post-Second World War era of U.S. and British dominance had given way to a new era of broader co-operation.
"If it's just Roosevelt and Churchill sitting in a room with a brandy, you know, that's an easier negotiation," Obama told his one-hour international news conference. "But that's not the world we live in, and it shouldn't be the world we live in."
Obama acknowledged the necessary compromises that led to the consensus, saying that each country "has its own quirks or issues that a leader may decide was really, really important."
Harper, who had called for greater American leadership at the summit, said there were "no fundamental disagreements in philosophy" among leaders.
That search for consensus appeared to nudge Harper toward embracing the more drastic measures for poor countries, which was represented by the massive IMF commitments.
Prior to the summit, Harper's officials in Ottawa said the issue of aid to poor countries was "secondary," and that they would be helped as part of broader economic steps.
"The implications of the recession in the developing world are much deeper. They're obviously much deeper in terms of the cost on human lives and much riskier in terms of potential effects on global security," Harper said Thursday.
A statement from Harper's office released in London said that Canada was contributing the extra funds so they could be "mobilized for IMF emergency assistance to ensure emerging markets and developing countries have access to capital they need."
Harper also stressed the necessity for stimulus that was quick and effective, the need for co-ordinated financial regulation, and the importance of co-ordinated financial regulation, as well as renewing his calls against protectionism.
Earlier in the morning, summit participants had to retake their official group photo after Harper missed the regularly scheduled portrait.
Harper arrived at the make-up session to chants of "Stephen, Stephen."
Harper's office said he did not make the original photo-op because he was being briefed on the communique leaks, but the BBC was reporting that the prime minister was actually in the bathroom.
"This is for you," a voice was heard saying as Harper arrived and World Bank president Robert Zoellick patted the prime minister on the back when he arrived for the second photo shoot.
"Is Harper here?" asked Obama, who flashed one of his trademark smiles and shook the prime minister's hand.
Such group photos are a standard feature of large international summits. Harper managed to make Wednesday's group picture, which was taken at Buckingham Palace with Queen Elizabeth.
Heavy security greeted Thursday's full working session of the summit. Hundreds of police officers blocked roads leading to the summit venue, while police boats patrolled the waters outside.
Anti-poverty crusader and singer Bob Geldof was also making the rounds at the summit Thursday, urging leaders to do more to tackle climate change.
"All of these summits seem to race to the bottom of agreement. But we cannot race to the bottom in London; we must race to the top . . . This can't be mutually agreed upon niceness. Time is up."
http://www.vancouversun.com/business...083/story.html 
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