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Treasury's Snow Sees Strong Global Economy as G8 Summit Nears

U.S. Treasury Secretary John Snow (© AP/WWP)

By Howard Cincotta
Washington File Special Correspondent

Washington -- Despite the pressures of rising energy prices and continuing barriers to free trade, the overall strength of the global economy remains impressive, according to U.S. Treasury Secretary John Snow.

In a June 10 statement following a meeting of finance ministers in St. Petersburg, Russia, to prepare for the Group of Eight (G8) Summit in July, Snow pointed to a world economy characterized by high growth rates –- notably among a number of developing economies -- historically low levels of inflation, and no visible signs of major financial crises or recessions.

The G8 countries are Canada, France, Germany, Italy, Japan, the United Kingdom, the United States and Russia.

"There is no better time for our economies to put in place policies that will sustain growth and improve living standards for all people," said Snow, who predicted that the G8 Summit in St. Petersburg would be "very productive."

Although heartened by strong economic recoveries in Europe and Japan, Snow warned that reform policies must continue to be implemented by all countries if healthy growth is to be sustained.

Snow noted that the United States continues to be "a major driver of the global economy," with 3.6 percent growth over the last year, an unemployment rate that dropped to 4.6 percent, inflation rates that remain low despite rising energy prices and an improved budget deficit.

The United States, Snow said, "remains committed to keeping our markets open to foreign investment and to pursuing an ambitious outcome for the Doha Development Round of global trade negotiations by the end of 2006." (See related article.)

To meet the threat to economic growth posed by high energy prices, Snow called upon oil producers to increase production and for consuming nations to "intensify their efforts to economize on the use of oil."

The G8 finance ministers welcomed representatives of China, India, Brazil and Korea to discuss the "role of emerging lenders to low-income countries," Snow said.

Their discussions focused on how to move forward from 2005's debt-reduction agreement, he said, and avoid recreating another "lend and forgive" cycle that the international community has worked so hard to end. Snow also called for greater emphasis by the G8 on better access to financial services in low-income countries, along with improvements in regulation to ensure greater competition. (See related article.)

Snow hailed his G8 partners for their leadership in tracking and disrupting international networks for money laundering and terrorist financing. "We have taken steps to strengthen our asset freezing systems and actions, enhance information sharing, and develop multilateral financial tools to disrupt criminal and illicit activity," he said. (See related article.)

The full text of Secretary Snow's G8 statement is available on the Department of the Treasury's Web site.

For more information on U.S. policies, see Trade and Economics, USA and the WTO, and Group of Eight (G8).