The second financial summit of G20 leaders was held in London, capital of the United Kingdom on April 2, 2009. Chinese President Hu Jintao attended the summit and delivered an important speech.

Taking place at the ExCel London, the summit was divided into two phases. Participating leaders mainly exchanged opinions on such issues as strengthening the macroeconomic policy coordination, stabilizing the international financial markets and pushing forward the reform of international financial system.

Delivering an important speech entitled Cooperating Hand in Hand and Pulling Together in Times of Trouble at the summit, Hu Jintao pointed out that the international financial crisis is sprawling and intensifying with ever increasing impact on the global real economy and the world financial and economic situations remain complicated and grim. The most pressing tasks at present are to spare no efforts to restore the growth of world economy and prevent it to fall into serious recession; oppose protectionism in whatever form and maintain an open and free trade and investment environment; speed up relevant reforms and rebuild the international financial order. We should further implement the consensus reached by the international community, build greater confidence, take more effective measures, conduct broader cooperation, implement more reasonable reforms and strive to achieve substantial outcomes.

I. To build greater confidence. The world economy has developed solid material and technical foundations after years of development, and the objective conditions to address the international financial crisis are already in place. Countries clearly have a bigger number of macro control tools which are far more targeted and effective than in the past. Therefore, we have the policy measures to cope with the international financial crisis. The international community is ready to strengthen coordination and cooperation, and hence we have the common aspiration of handling the international financial crisis. We are able to overcome the difficulties and realize our common goals so long as we remain confident and take joint actions.

II. To reinforce cooperation. Since the international financial crisis takes place against the background of deepening economic globalization and increasing interdependence among nations, no country can survive it alone, and cooperation is the correct choice. We should understand the situation clearly, strengthen coordination, support each other and join hands together to pull through the troubled times. Our macroeconomic policies should be consistent, timely and far-sighted. The G20, as an organization with broad representativeness, is a major effective platform for the international community to jointly handle the international financial and economic crisis. We should intensify the pragmatic cooperation, accelerate structural readjustments, stabilize the market, promote growth, create more jobs, improve people’s livelihood and try our best to reduce the impact and influence of the international financial crisis on the real economy.

III. To further push forward reforms. To strengthen financial regulation is not only the key to preventing and addressing international financial crisis but also a critical measure of maintaining the stability of international financial markets and promoting the world economic growth. This international financial crisis has sent an important signal to us that to strengthen financial regulation is imperative. First, we need to strengthen cooperation on financial regulation, handle appropriately the relations between universality and particularity, self-discipline and external regulation, short-term and long-term interest, enhance the financial regulatory capacities of countries, improve the international financial regulatory framework and enforce effective supervision over cross-border financial institutions and rating agencies. Second, the international financial institutions should increase assistance to the developing countries. Third, the Financial Stability Forum (FSF) should play a bigger role. Fourth, the International Monetary Fund (IMF) should reinforce and improve supervision over the macroeconomic policies of related parties, especially the major economies issuing reserve currencies. Particular focus should be put on the regulation of currency issuance policies. Fifth, the governance structure of the IMF and the World Bank should be improved to enhance the representativeness and voice of the developing countries. Sixth, we should improve the international monetary system and the reserve currency issuing regulatory mechanism, maintain the relative stability of the exchange rates of major reserve currencies and promote a diverse and reasonable international currency system.

IV. To further oppose protectionism. No country or region should practice protectionism at the excuse of stimulating the economy. We should jointly oppose the trade protectionism in whatever form, the increase of market access thresholds at whatever excuse, the various investment protectionism behaviors in order to shift troubles into others and the abuse of trade remedies. The Doha round of talks is critical to the progress of global trade liberalization. We should adhere to the consensus reached among parties concerned in July 2008, move forward on the basis of existing framework and promote the talks to achieve comprehensive and balanced results at an earlier date.

V. To extend greater support for the developing countries. The international community should pay high attention to and strive to minimize the damage caused by the international financial crisis on the developing countries, especially the least developed countries. The international community, the developed countries in particular, should undertake their due responsibility and obligation, continue to fulfill their commitment of providing assistance and reducing debts, keep or increase their assistance to the developing countries tangibly, help the developing countries maintain financial stability and boost economic growth, assist the developing countries, especially the African ones overcome difficulties and constantly improve the external environment for their development.

Hu noted that the international financial crisis has posed unprecedented difficulties and challenges to China. In order to address the crisis and maintain the stable and relatively fast growth of domestic economy, China has made timely readjustments of macroeconomic policy, implemented resolutely a proactive fiscal policy and moderately relaxed monetary policy and developed the package plan of further expanding domestic demand and stimulating economic growth. Those measures have shown initial results and positive signs. It demonstrates that China’s way of coping with the crisis is realistic and policy is effective.

He stressed that we would continue to adhere to the basic national policy of reform and opening up and unswervingly pursue the open strategy of mutual benefit and win-win results faced with the international financial crisis. China, as a responsible member of the international community, always takes an active part in the international cooperation on addressing the crisis, which shows China’s firm attitude of insisting on reform and opening up and promoting the recovery of world economy. China will continue to strengthen macroeconomic policy coordination with the international community, push forward the reform of international financial system, actively maintain the stability of multilateral trade mechanism and make due contributions to promoting and restoring the world economic growth. (See another article for the full text of the speech)

According to the statement issued by the leaders at the end of the summit, participating leaders reached multiple consensuses on the global joint efforts of coping with the financial and economic crisis, including increasing the funding of the IMF and strengthening financial regulation. The G20 leaders agreed to provide a total amount of US$1.1 trillion to the multilateral financial institutions like the IMF and the World Bank, and as a result the funding size of the IMF will triple from US$250 billion to US$750 billion to help those countries in trouble.

The statement noted that the G20 leaders think it necessary to regulate and supervise the financial institutions, products and markets with systemic influences and for the first time put hedge funds under the financial oversight. In addition, credit rating agencies and salaries of senior corporate executives will be subject to tighter supervision. They reiterated opposition to protectionism and pledged to promote global trade and investment. They also agreed to set up a fund with an amount of at least US$250 billion for trade financing so as to promote world trade and stimulate global economic recovery. They announced that another G20 summit will be held this year.

Hu attended the working luncheon of G20 leaders at noon.

G20 leaders and the leaders of relevant countries and international organizations participated in the summit.

Vice Premier Wang Qishan of the State Council was also present at the meeting.

On the evening of April 1, Hu attended the reception hosted by Queen Elizabeth II and the working dinner hosted by British Prime Minister Brown.