Currency disputes complicate global rebalancing

The Group of 20 leaders are facing a daunting challenge to fix the global imbalance in trade and economic structures amid escalating tension over currencies.

The leaders of developed and major emerging economies will gather in Seoul on Nov. 11-12 for their fifth summit. 

Global rebalancing is one of the top priorities to ensure sustainable and strong growth in the post-crisis world economy.

They are expected to work out a comprehensive policy toward balanced growth, mainly fixing the trade imbalance between the U.S. and China.

It seems that the accord will include policy commitments made by each country, based on the basket of policy options agreed to at the fourth Toronto summit in June.

The first G20 Summit was held in Washington, D.C. in December 2008 to tackle the global financial crisis. The series of meetings continued in London in April 2009, Pittsburgh in November 2009 and Toronto in June 2010.

Korea, as the G20 chair, has been coordinating with G20 members to facilitate the implementation of the agreed-upon framework for balanced growth.

The International Monetary Fund, in its research report, said that it had long worried about global imbalances.

In its “multilateral consultations on global imbalances” (conducted in 2006 with China, the Euro area, Japan, Saudi Arabia, and the United States), the IMF promoted a joint approach to reducing global imbalances while sustaining world growth.