Group of Seven finance ministers can't agree on plans for global growth

February 28, 1993|By Los Angeles Times

LONDON -- The United States tried to collect the firs international payoff of President Clinton's recovery plan yesterday but emerged from a meeting of finance officials of the leading industrial powers without firm commitments that they would attack their own most pressing economic problems.

The group agreed on the common need to stimulate world economic growth. But Germany did not commit to specific steps to bring down its troublesome interest rates, and Japan gave no assurances that it would speedily stimulate its own economy and reduce its huge trade surplus with the United States, officials said after the meeting.

Britain, suffering through a recession that has lasted 40 months, lauded the Washington plan for tax increases, deficit reduction and job stimulus. But Norman Lamont, the chancellor of the exchequer, would not endorse it as a model to be followed here.

After years of being berated by other governments for its ballooning budget deficits, the United States has suddenly found itself in the unaccustomed situation of dealing with its allies from a position of political and economic strength.

Secretary of the Treasury Lloyd Bentsen and a senior aide who accompanied him to London said before and after the meeting that despite the administration's new leverage, their goals for the London session did not include obtaining specific pledges.

"They were quite enthusiastic about what we have done," Mr. Bentsen said afterward. "There's no question that it fortifies our position."

Declaring the get-acquainted meeting "productive," and one that began "to lay the basis for a stronger world economy," Mr. Bentsen said at a news conference that the other finance ministers "recognized that while the United States is prepared to lead, we alone cannot guarantee prosperity for the world."

"The policies we each pursue must reflect our own national interests," he said, after spending the morning and luncheon hour with his counterparts from Britain, Canada, France, Germany, Italy and Japan.

But, in an echo of Mr. Clinton's speech Friday that closely linked the U.S. recovery to similar progress around the globe, the new ** secretary of the treasury added: "Increasingly, where economic growth is concerned, national interests and international imperatives coincide."

It is a theme to which political leaders in each of the leading industrial democracies have subscribed for years. But they have found that trying to live by it can produce political dilemmas.

For the Clinton administration, the outcome of meetings such as yesterday's have a bearing on the domestic agenda. In a world increasingly dependent on global trade, the success of Mr. Clinton's economic agenda will depend to some extent on international cooperation.

Lower interest rates in Germany can produce long-term growth that expands markets for U.S. products; so, too, would Japan's emergence from its economic downturn.

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