The Group of 20 will likely agree on specific targets for slashing their deficits and addressing the staggering debt loads they accumulated to fend off economic collapse, European Commission President Jose Manuel Barroso said Saturday.
Europe's top official made the comment in a briefing with reporters ahead of the summit on Sunday, where fiscal consolidation will be the central economic topic. Such an agreement would help paper over sharp differences that were highlighted in recent days as officials from the world's advanced economies emphasized the difficulties associated with putting themselves on a more sound fiscal footing without scuttling the global recovery.
In fact, Mr. Barroso said that benchmarks proposed by Prime Minister Stephen Harper last week in a letter to his G20 counterparts have been agreed to among top officials from most countries.
"The minimum deficit goal will probably be accepted," Mr. Barroso said, referring to Mr. Harper's call for G20 nations to cut their budget shortfalls in half by 2013.
The need to attack debt loads in several of the biggest economies without stifling the global rebound is a "balancing act" for the G20, Mr. Harper said Saturday while speaking to business leaders, acknowledging that the debate over how quickly and aggressively to cut stimulus spending has produced economic "tensions."
Mr. Barroso echoed comments from Mr. Harper and other leaders as they sought to put a united face on one of the more contentious issues on the table this weekend, contentious mainly because of the different speeds at which the various G20 economies are healing, and differences in their fiscal health.
"We are all aiming at the same goal - economic growth," Mr. Barroso said.
That may be true, but the gulf on the issue appeared to widen in recent days as countries such as Germany and Britain suggested that they might push for stricter targets than what Mr. Harper proposed, while U.S. President Barack Obama has warned that certain economies in the group are still too fragile to withstand severe budget cuts.
Brazil expressed concern Saturday that some European countries are cutting too fast, putting the global recovery at risk and potentially harming developing nations should it cause another downturn.
I'm pleased that there does seem to be a growing understanding and acceptance of the necessity - particularly in the midterm - to have credible plans to tackle the growth of deficits and debt and the sovereign risk that that entails. Canadian Prime Minister Stephen Harper
"The emerging countries should not carry the burden for the recovery alone," said Brazilian finance minister Guido Mantega, who is representing his country in place of President Luiz Inacio Lula da Silva, who opted to stay home and deal with the government's response to flash floods.
"This is a joint project. The burden should be borne by us all."
Mr. Mantega said Mr. Harper's proposal to place debt as a share of gross domestic product on a downward path by 2016 is "quite reasonable," but may be hard to meet for some G20 members.
Mr. Harper, meanwhile, stressed that on the broad strokes at least, all nations are on the same page.
"I'm pleased that there does seem to be a growing understanding and acceptance of the necessity - particularly in the midterm - to have credible plans to tackle the growth of deficits and debt and the sovereign risk that that entails,'' Mr. Harper said, echoing French President Nicholas Sarkozy and U.S. Treasury Secretary Timothy Geithner, who both tried to downplay talk of divisions within the G20 on deficit reduction during separate conversations with reporters.
Speaking at a press conference after his arrival in Toronto Saturday, Mr. Geithner said talk of disagreements over how best to secure the recovery were exaggerated. G20 countries have "more in common than in difference," Mr. Geithner said, adding that the U.S.'s deficit-reduction plan over the next few years is actually more aggressive than Germany's.