By Alex Brummer
GuardianApril 27, 1999 The Group of Seven finance ministers and central bankers were last night moving towards an agreement which would double the number of poor countries which qualify for debt relief and ease the terms in a drive to deliver an anti-poverty strategy before the millennium. Gordon Brown, the chancellor, found himself at the forefront of the discussion with his proposal for a much more aggressive gold sale of 10 million ounces by the International Monetary Fund, to fund the enlarged debt relief scheme.
The Washington G7 meeting was being held against a much calmer financial background than when the ministers met last autumn. Nevertheless, there were sharp differences between ministers over the state of the global economy and the extent to which the private sector should be involved in resolving financial crises. The G7 is made up of finance ministers from the US, Japan, Germany, France, Italy, Britain and Canada.
In a rare dispute with the Americans, Mr Brown wants to see solid, codified rules for private sector involvement before loans proceed, whereas the US treasury secretary, Robert Rubin, used the meeting to advocate a flexible approach in which the 'door to official finance be kept open'. Mr Brown also made it clear that he wants the IMF surveillance process - its annual inspections - to be strengthened to include the various codes that Britain has been advocating, covering fiscal and monetary policy as well as a statement on social principles and corporate governance.
Ministers from the Anglo-Saxon countries, which have seen robust economic growth in recent years, were anxious to press their Euroland and Japanese partners on expanding their economies. It was made clear that they want to see no slippage in Tokyo on banking reforms and fiscal expansion, despite a swelling budget deficit. Similarly, there is a view in the US that the European Union's half-point interest rate cut may be inadequate to ensure a take-off in Germany, Italy and France where growth has slowed.
Mr Brown stuck with his growth forecast for Britain of 1-1.5% this year, despite the IMF's decision to downgrade the rate to 0.7% in its World Economic Outlook report.
Overshadowing the financial meetings has been the promise by Nato ministers at the weekend summit to provide an economic plan to assist frontline Balkan states. A special meeting of leading ministers from the IMF/World Bank has been called for tonight in Washington at which the scale of support and the best way of funnelling it will be assessed.
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