G-20 Summit: No consensus yet on joint statement

SEOUL: Amidst an escalating currency war between the US and China and differences on trade imbalances, negotiators at the G-20 Summit were struggling today to find common ground on a joint communique that was expected to speak out against competitive devaluation of currencies and protectionism, taking on board India's concerns.

Indian sources said notwithstanding the strong views held by the US and China on issues like currency valuation and trade deficits and surpluses, a consensus is evolving on the need for countries not to resort to competitive devaluation or undervaluation, a stand the G-20 Finance Ministers took at their meeting in South Korea just last month.

China has been strongly resisting attempts by the US to revalue its yuan, as a lower value gives it a tremendous export advantage over other countries. But the US Federal Reserve's decision to pump USD 600 billion into the sluggish American economy, effectively devaluing the dollar, has also not been taken to kindly by countries like Germany.

Notwithstanding Summit Spokesman Kim Yoon-kyung's claim that major countries are deadlocked on issues, Indian sources said the outlook was not all that gloomy and a consensus document on many issues was likely to be hammered out during Summit proceedings tomorrow.

Sources said the joint communique is expected to call for countries to desist from competitive devaluation, a point Prime Minister Manmohan Singh is expected to tell the Summit in the plenary session immediately after its inauguration tomorrow morning.