The White House acknowledged Friday the eurozone debt crisis would be the main issue on the table at the G20 meeting next week in Mexico, adding world economies needed to come together and agree to equal risk-sharing in the handling of the crisis.
"At Los Cabos, the G20 looks forward to hearing more from the European leaders on the progress of their efforts to stabilize their banking system and promote growth, and to hear what their vision is for taking this effort forward toward fiscal and financial union," Deputy Assistant to the President and Deputy National Security Advisor for International Economic Affairs Michael Froman told reporters Friday.
"That being said, Los Cabos will not be the final word on the eurozone. That is a continuing conversation with some important milestones, including a meeting of all EU leaders coming up in Brussels at the end of the month."
The meeting will bring together four of 17 eurozone members and five of 27 EU members, plus European Council President Van Rompuy and European Commission President Barroso. Hosted by rotating G20 president Mexico, the meeting will be broken up into group discussions, bilaterals and sidelines meetings.
The president's first two bilateral will be with UN Security Council permanent members Russia and China, with whom the U.S. has had recent disagreements over major international crises such as the violence in Syria.
On Monday, President Obama will meet first with newly re-elected President Vladimir Putin of Russia to discuss trade issues, Iran's nascent nuclear program and Syria. The U.S. has heavily criticized Russia for continuing to supply arms to the regime of Syrian President Bashar al-Assad and has stated this is one of the factors that lead to recent upswings in violence.
"We have had a very substantial difference with Russia on the issue of Syria," Deputy National Security Advisor to the President for Strategic Communications Ben Rhodes said Friday, the day before the United Nations announced it was suspending its peacekeeping mission in the country because of danger to its staff.
"We'll continue to work through that area of difference with the Russians because we believe that they can play a role, again, in pressing the Assad regime and supporting a political transition," Rhodes added.
In the China bilateral with President Hu Jintao on Tuesday, the president will discuss how to sustain global growth and will also touch on North Korea and Iran.
"Growth in many key emerging markets is also flagging," Under Secretary of the Treasury for International Affairs Lael Brainard told reporters Friday. "Many of these countries, such as China, have the fiscal and monetary capacity to take actions to spur domestic demand and to help support global growth."
"The key, of course, to achieving [rebalanced demand and overall growth] is for China and other surplus emerging market economies to take fiscal and other measures to support domestic consumption as well as allowing exchange rates to reflect market forces," he added.
When asked if the ultimate responsibility of handling the eurozone crisis is in the hands of Germany, Brainard rejected the claim, saying, "it's very important to see risk-sharing, backstopping of the banking system to greater fiscal union. And so, in the days ahead, that is really where our focus will be."
As far as the United States' specific role in the eurozone crisis, the American officials made clear the U.S. would continue to provide leadership by encouraging growth domestically.
"The President's approach of spurring job creation and growth in the near term, and meaningful deficit reduction in the medium term represents the best policy to protect the U.S. economy and to do our part as the world's largest and most important economy to maintaining the global recovery," Froman said.
The G20 major economies leaders' summit in Los Cabos, Baja California Sur, Mexico will run from June 18 to 19. It will be attended by leaders from Argentina, Australia, Brazil, Canada, China, the European Union, France, Germany, India, Indonesia, Italy, Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey, the United Kingdom and the United States. The IMF and World Bank also participate.
by RTT Staff Writer
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