face to face with the news maker. hello again and welcome to spotlight they interview show on r.t. i'm algernon event today my guest in the studio is john kerry. has the state and the biggest names of the political and financial world have gathered in seoul this week for another g. twenty summit they're discussing the possible ways overcoming the global economic

imbalance which actually is blamed for the recent financial crisis the g twenty probably has the weightiest opinion on this matter which is confirmed by john keratin the founder and director of the g. twenty and the g eight research groups. the g twenty was born just two years ago was an attempt to bring together the financial elite of the leading economics the aim was to brainstorm ideas on how to overcome the financial crisis the forum has quickly gained in value today the participants will try to come up with a decision on global imbalance imagine economies are blaming the developed countries for this saying very exorbitant appetites for cash make the balance even bigger now the g twenty has to go forward and make some difficult decisions. it's a good. welcome to the show great to be here thank you very much for coming in again

well this year the biggest the biggest issue on the global economy has been the danger of the so-called currency war as we've discussed it in this studio already now i want your opinion do you think that the g twenty is the best venue to try to settle the looming economic on its own very much so because there's nowhere else to do it a few years ago in two thousand and six there was an effort at the international monetary fund to do it but too many members too many rules and of course not real leaders there to take ownership of it so it's a good thing that the h. e twenty summit has taken it up we've seen just a few weeks ago when g twenty four finance ministers met that there was a major move forward to try and produce a multilateral solution to what looked like

a unilateral cycle of retaliation but now it'll be up to the leaders at work already to take the next step to move from a general political agreement to start working towards specific guidelines about what indicators what numbers will be a while in the interests of all while the g twenty members they are not equal well for example the biggest plays of course are of the club china and the united states do they set any guiding principles can they dictate or. or why well on the whole there is as democratic as it looks as if i mean that you twenty i know some countries are inevitably more important and others for different reasons but the basic bargain. that was recognized back in one thousand nine

hundred nine when the g twenty was formed at the finance ministers' level is that all of these countries are systemically significant that's a criteria so you can be systemically significant by being a producer of financial security or by being a consumer if you go down say argentina you can take all of your neighbors down so you have to be in the club to agree to the rules so there's no a hole in the dike no we call it link and of course the bigger countries can watch the smaller ones to make sure that they're moving in the right direction but even without of course what we've seen on some of the tough issues the g twenty has moved ahead with reform of the international monetary fund. at the pittsburgh some of the g twenty finance ministers a few weeks ago it was a smaller group that got together to crack the deal and in both cases of course

some russia was in that smaller group or a. in mid november france takes over as the chair g seven or the driver's seat at the g seven and it has made the reforming the international monetary system the focus of this year long presidency well according to your opinion according to your information are according to your feelings how many countries among the claim that have been among the twenty are going to support mr sarkozy's program of reform i think a significant number. significant is it a majority think a majority in the end it depends on what we mean by this grandiose term and i suspect what we're going to end up with is far less ambitious than nicolas serco see. in his very franks way likes to present but we've already seen

a broad recognition that the old way of doing things since one nine hundred forty five when the us dollar was the old the only pillar that's not good enough anymore what we saw at the second g twenty summit in london in april two thousand and nine was the g. twenty basically saying yes to an idea from china the central bank governor saying we had to move towards a more pooled form of reserve currency in a limited way the special drawing rights at the international monetary fund yes only for currencies a lie behind it but in the coming years through will be more of them for a greater reliance on ours and as we see the internationalization of the greater a use in the region of the chinese renminbi its currency it's growing as an

international currency and certainly we've seen from the russian federation an argument that there is should be a regional reserve currency with the the ruble playing its full part and if you look ahead another part of the french agenda is commodity prices right commodity prices are probably going to matter more we're already saying commodity markets soaring oil gas gold and so many other things so those countries such as the russian federation which have those real resources backing their currency i think can look forward to the day where appropriately their currency will have a greater part in the international monetary system is a halt that may look like a good thing status for a stage. but with that of course comes special responsibilities which i'm sure the

russian federation will be willing to bear their joint you just mentioned sarkozy doing something and in this very french way every time i hear somebody say that we're i hear for example an englishman saying well well for example at bama is going to do that it is very a marriage kind of way i always wondered what's the kind of taisha there's a positive rather negative well anyway is there still a division into those two camps in the g twenty to be serious one represented by france while control of the one fighting and the other is more more conservative but liberal like the united states has prevailing today and that's one of the divisions certainly in the g twenty but there's enough diversity in the g twenty that there's a larger array divisions but you're right there are a few countries in the g twenty who are attached to the anglo american model of

capitalism led by the it added states and britain. and they were the ones with should do it's a certain extent by the way well this sympathetic i mean to this financial you say that used to be at the i used to be this financial crisis was a fact we're all still suffering from was really born and bred in the usa in the mortgage market. in new york but also in britain northern rock was the first bank to go down on the european continent there's a greater faith in the role of the state harder top down regulation of the financial system every day we live this duality in canada because we're both an english and a francophone country and fortunately. we did things well enough that none of the canadian banks had a problem. in the crisis and as

a result canada is leading the group of seven in the growth coming into the recovery but beyond the transatlantic difference if you will even. china. saudi arabia i mean with very heavy state honed and state controlled financial systems far more than what is the norm in france so one of the great to challenges but strengths of the g twenty is how the leaders can learn about the greater diversity in the world well speaking of diversity should this diversity be be be preserved in the eudy should one of these positions start start winning or do you think that the truth is somewhere in the middle and we should have different opinions and and this clash of opinions just because it's there has to be

a difference of opinion at the beginning not only because it's inevitable law bought because these leaders the consensus of the impossible only twenty countries i mean this is the tokyo oh the leaders need to learn from each other and you can see that happening at each of these twenty summit but because there's twenty there can be unusual coalitions that form let me take just one example of from the g. twenty should we slap a new levy on our big bank city dishing to all of the other taxes the continental europeans in this case think it's a terrific idea so did the british so you had team europe often supported by the united states if that debate were discussed in the old she's seven well the only country that was against it then that thought it was a bad idea was canada. but it's been dealt with in the g.

twenty and every other member of the g. twenty out side of the chief seven agrees with canada including the russian federation that's a really bad idea so that new coalition canada and russia by the only ones from within the g eight together with all of the rest from the g twenty we've won that debate so there's a consensus and it's done the right way says john kerry and the founder and director of the g. twenty and the g. eight research groups spotlight will be back shortly right up to break will continue their sense of you so stay with us then down. download the official t. application to go on the phone all i pod touch from the i choose our. life

on the go. video on demand ati's minefield costs and says feeds now in the palm of your. question on the dot com. this is just a parliament building in urban. them. sixty five years ago. it was the final target. a major offensive from the red army. its capture became the symbol of the fall of the financial tsunami. and the victory over nazi germany. the following.

welcome back to the spotlight i'm going of in just a reminder that my guest in the studio here today is john kerry the founder and director of the g. twenty and g. eight research groups. well i had mr alex our shingo here in the studio a while ago we were talking about the these possible currency wars financial wars and he said. well i almost quote i almost because that's that this finance ministers meeting in a job or the g. twenty pledged to refrain from damaging competitive currency devaluations but they can refrain from that well maybe for a week maybe for a couple of weeks no more do you agree is that true or is it is that the price of those of those. i mean the taunts and decisions taken well i his

week is up and they're still refraining so whether they can move beyond two or three weeks we don't know but so far so good and i think it will go on for a much longer time because many of the countries that were engaging in practices that their neighbors their partners or didn't like have really seen that they could be moving too close to the brink that everybody would be much worse off if they didn't stop so what they did a couple of weeks ago at the finance ministers' meeting which they found i think a sensible solution that look other currencies themselves are just one small of highly visible part of a broader problem it's the current account imbalances that lie underneath so let's look at the cause of the problem and come to an agreement about when imbalances are

too big what kind of and by. and says are too big and see if we can come up with indicative guidelines rules of the road so that if one country gets too far out of line to be a discussion everybody else sit down and say look how can all of us help not just one country it's your problem solve it all on your own a chorus imbalances have two sides one country exports too much because the other country imports too much so it's both the debtors and the creditors that have two. together and i think what we're going to see here at the summit is the next step forward and more specific guidelines as to what that multilateral regime will be well what what i was actually driving at when i was quoting mr erlich session is

as a matter of fact the former russian deputy finance minister a former russian sent an essential back had the central bank is that of the decisions taking and these taken at the summit. need twenty g. eight they are maybe implemented maybe not but the money spent on these summits themselves are pretty great and this year's summits of the both g eight and g twenty in toronto caused much criticism in the world over the amount of cash spent on them spotless to me they will tell us more and that. it was this fake leak which came to symbolize extravagant spending on preparation for the g eight engine twenty summit lake was sit up in the press room but instead of being impressed journalists who by the extravagance take you into that most think link was the real one in one of the world's biggest ontario which caused even

tougher to prove this isn't just one billion dollars spent. security the moment greatly exceeded biggest two previous summits. the fact to violent protests in toronto who took the g eight and g twenty this critical situation as an incredible waste of money. this summits were to cover the issue of getting government spending under control most speakers suggested the world leaders had plenty of other opportunities to meet and the christless summit monotonous a series. there's a downside to what we just heard from our reporter can you name a particular measure which has been implemented. after a decision taken at g twenty summit one that had a positive effect globally and shoot on the whole the g twenty leaders to keep the

promises the commitments they make at the summit here quite as well they prefer not to make real commitment well sometimes they do make a very big ones the very first summit in washington they all agreed symbol taney asli to engage in very large scale fiscal stimulus and virtually all of them did an unprecedented amount at the london summit the second one they agreed to together produce over a trillion dollars in additional stimulus targeted towards the poor countries in the poor people and on the whole that money was delivered at the trot osama. yet had the big job of controlling the euro crisis that was catalyzed by greece and the way they get out was coming up with a message of yes cool stimulus no stimulate now because the recovery is still

fragile but will exit soon in two thousand and eleven and then we'll can. troll our budget deficit and accumulated debts by two thousand and thirteen two thousand and sixteen that might not seem like a big problem in the russian federation which doesn't have bad government deficits and debts but boy in many european countries it was a very big problem what we've seen is since toronto people are keeping that commitment sarkozy of france despite all of those riots and protests in france the other week david cameron in britain cutting his budget to a degree a larger than any other british government since the second world war causing real pain to his people leaders willing to run the risk of unpopularity to keep

that some commitment short term pain for a longer term gain but they know that they really all have to do a do it because if they don't other countries will defect and everybody inside the g twenty and without will soon be much worse off so our agreements like that. several trillion dollars in fiscal stimulus over one trillion dollars out london are they worth the fifty seven thousand dollars for the fake way and she actually showed the people of the world what lakes in canada and russia are really like well well well you know i think if we are asked that pretty much the british people that sounds right i think i think they would they they would say that those a long short term pain is not much better than a deficient fake late so let's have a look at now. this is the g.

twenty have you just mentioned that that that the presidents and the prime. ministers started working in the interests of a community. of the club now but do you have a mechanism that would would stop individual countries from pursuing national economic solutions this regarding the global economic interests there's a lot of them in the first instance through the a mutual assessment process each of the g twenty leaders are going to have to look each other in the eye get advice from the international monetary fund about what their specific countries should be doing to make everybody better off and everybody is not just the g twenty members but because those twenty are so important to the global economy as a whole it's for everyone in the world the south korean host has done an

important job on the road to the soul summit of an extensive reach program consulting regularly with the united nations with countries around the world and then actually inviting to the summit. the leaders of regional organizations in africa the poorest region of the world the association of southeast asian nations singapore as the head of a three g. group of twenty seven smaller states and then of course we'll have the ban ki-moon the secretary general of the united nations bob zelic head of the world bank there at the summit sitting down with the leaders making sure that the voices of the poor in the world outside the g twenty are heard loud and clear. today when the g. twenty is is becoming a household name from politics and economic decisions those that mean that the g

eight is actually dying as institution oh no no. what we saw there i know you the father of both says that that would make you sad of course if well done really it means twice as much work for us in the g. eight research group in the g twenty if you got lost struggling to keep them both alive again well i think what we saw a few months ago when both summits were held together g eight muskoka g twenty in toronto you could compare which one was working better than the other were neither working could they work together and i think yes he was overwhelmingly yes both could work well together so up at muskoka of the g eight they raised in the teeth of the worst recession when governments felt they had big deficits they mobilized an additional seven point three billion dollars for maternal and children's health to save the lives of thirty. million mothers

and babies that are needed over the next five years and the u.n. back in september built on that foundation with another forty billion dollars or so meanwhile down at toronto they really did stop the euro crisis and we just have to reflect if we had another big financial crisis as we did in the autumn of two thousand and eight that first one was solved by government spending as i mentioned but this time there were no governments with spare money to spend so it had to be solved a different way and trauma did the job thank you thank you john that was a great interview really i enjoyed it and just a reminder that my guest in the studio today was john kerry and the founder and director of the g. twenty and the g. eight ri says good to see that's it for now from all of us here will be back with

more for us than comments on what's going on in and outside russia on. well then stay on r.t. and take it that's the theory of the. hunger for the full story we've got it first hand the biggest issues get a human voice face to face with the news makers on.

shared recovery beyond the crisis that's the theme here at the g. twenty which is kick off in seoul join me and you can now wait for the.

balance on the streets of london as students protest against the hiking tuition fees and the government it says has broken its promise it's. selling a fantasy as the u.s. pulls out all the stops to recruit soldiers some veterans when they. drilled into the army on the pretense it's. a more analysis of the g. twenty meeting coming up in the business update as russian president dmitry medvedev calls for better access to capital for small and medium sized businesses. are you watching r t welcome to the program but it's go straight to south korea where the g twenty leaders are gathering on the one thing on the money those ruling the world's major economies are confronted with preventing a recurring.