The world’s most powerful leaders meeting in Cannes are locked in talks over boosting the International Monetary Fund (IMF) to help eurozone economies, with negotiations said to be “on a knife edge”.
Countries in the eurozone want an expansion of IMF funds and are pushing for agreement as the G20 summit of the world’s leading economies reaches a conclusion this afternoon.
But talks are currently deadlocked, with officials close to the negotiations saying that Barack Obama, the US president, and other non-European leaders want proof from the eurozone that it can get its own house in order before they pledge greater funds.
The US wants to keep “pressure” on the eurozone to bring its sovereign-debt crisis under control, so it is unlikely that the G20 will announce any figures for an increase in the IMF.
In turn, the European Union, as well as Nicolas Sarkozy, France’s president, and Angela Merkel, Germany’s chancellor, are seeking commitments from Silvio Berlusconi, Italy’s prime minister, that he will be able to implement plans to reform the country’s economy.
They are also watching events in Greece, where George Papandreou, the prime minister, faces a confidence vote in parliament tonight.
Last night, after the main G20 talks, Obama joined Merkel and Sarkozy, and the leaders of France and Spain to discuss ways to bring the eurozone crisis under control. They were joined by Christine Lagarde, the IMF’s managing director, José Manuel Barroso, the president of the European Commission, Herman Van Rompuy, the president of the European Council, Jean-Claude Juncker, who chairs meetings of European finance ministers, and Mario Draghi, fresh from presiding over his first governing council of the European Central Bank.
The G20 summit is scheduled to draw to a close early this afternoon.
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