G7 Meeting Left No Clues Of How To Battle Budget Deficit Around Europe

A new economic week begins after the weekend ended with G7 meeting taking place in Canada, while the European finance ministers said they are going to make sure that Greece meets its target of narrowing the deficit to below 3% by year 2012.

There is tranquility in the markets while there are fears that the budget deficits around the European economies, will weigh on economic growth as this might be the next bubble to occur and spread quickly around the world. Although borrowing money on the short run, is a good sign for the nation because this means that there is money flowing in the markets, yet in the long run, it means that the debt has to be paid back.

During the G7 meeting, officials including Chancellor of the Exchequer Alistair Darling of the United Kingdom and U.S. Treasury Secretary Timothy Geithner both stressed the idea that economic growth should be revived and that a global economic recovery would not be threatened in any way so that the world steps out of recession.

Greece has all the focus from European finance ministers as they deal with a budget deficit of 12.7% of GDP, while last week we saw that Portugal and Spain might also be dealing with a fragile fiscal position as well, therefore this caused the global stock market last week to fall to the weakest level in three weeks.

At the meeting, European finance ministers failed to mention new measures that would help narrow budget deficits around Europe, therefore this disappointed investors as the Canadian finance ministers said this issue was not going to be covered by the European Union nor the G7 while they said they will excuse Haiti from any debt they have, as they suffered a horrific earthquake on the 12th of January of this year.

Ecpulse