International Monetary Fund chief Christine Lagarde has called on Australia to help the G20 work together to complete financial sector and tax reforms, as a resurgence of unilateral approaches to monetary policy threatens to undermine the global body's mandate of international economic co-operation.
Subscribe now for unlimited access.
$0/
(min cost $0)
or signup to continue reading
The reforms, which were initiated after the global financial crisis, had made good progress but ''the mission is not accomplished'', Ms Lagarde told Fairfax Media's Good Weekend magazine.
''I would hope that the resilience, the determination and the energy of Australians in general and hopefully of the Australian G20 team can help the world complete the job,'' she said.
The finance ministers and central bankers of the G20, a group of rich and developing nations, are set to meet in Sydney this weekend for the first time since the United States started to reduce its massive stimulus program amid signs of a sustained economic recovery following the financial crisis.
The meeting comes at a critical time for the global economy following a rout in emerging currency markets last month, prompting central banks from Russia to Turkey to fight back through interest rate rises or exchange rate interventions.
At the same time, the Australian economy has seen the dollar pushing back up above US90¢, following signs of a steady path for the withdrawal of the stimulus program under US Federal Reserve chairwoman Janet Yellen.
Ms Yellen will make her first international appearance in her new role in Sydney.
The G20 was upgraded to a leaders' summit in 2008 following the financial crisis, with the international body seen as a key forum to tackle the global fallout.
This year's series of G20 meetings in Australia are meant to focus on fostering economic growth. But the recent turbulence faced by emerging markets as the US winds
back its monthly bond-buying program and the outlook for China's growth could dominate Sydney's agenda instead.
A US Treasury official has acknowledged the emerging markets' turmoil would be a ''focal point'', although analysts said the Federal Reserve was likely to continue acting in the best interests of the American economy.
US Treasury Secretary Jack Lew is also set to attend the meetings.
''The Fed has to look after No. 1 and the world later,'' said JP Morgan's chief economist for Australia Stephen Walters.
''A concrete objective [for the G20 meetings] would be a coherent communication strategy and a way to start unwinding this policy stimulus without disrupting markets, but it could sound like a platitude. Lets hope it's more than that.''
India's central bank governor Raghuram Rajan criticised the US and other developed countries last month, saying that ''international monetary co-operation has broken down''.
Another point of contention between the US and developing countries could be the Americans' failure to push through IMF reforms giving emerging economies a bigger say in the international financial system.
