The finance ministers of the world’s leading economies have reached an agreement aimed at tackling global economic imbalances despite objections from China, according to Bloomberg. At the latest meeting of the Group of 20, officials approved a set of indicators that would act as an early warning system to detect imbalanced trade and investment flows. The finance ministers listed the gauges that will be used as part of the agreement, which include budget deficit levels, external imbalance, and private savings rates.
The new scorecard will not use hard targets, but will instead act as an alert for the impact of economic policies on the global economy. Thomas Stolper of Goldman Sachs said the measures were part of “slow but steady progress towards better international policy coordination aiming at reduced global imbalances.” China was able to successfully dilute some of the language of the agreement, and earned the omission of foreign exchange reserves from the new plan.