Leaders of the world's 20 biggest economies closed in on a deal last night over which indicators should be used to measure global "imbalances", blamed as a cause of the financial crisis.
The discussion of what constitutes a destabilising economic policy reopened a split between China and the US over what many perceive to be the undervalued yuan, which has helped Beijing accumulate huge savings and kept its economy buoyant despite the global downturn.
After days of tense talks, delegates decided to include current account imbalances, government debt levels and private debt in the indicator list. They may also include a fourth indicator covering foreign exchange rates and currency reserves, senior officials said following meetings of the Group of 20 (G20) leading and emerging economies in Paris at the weekend.
Saudi Arabia is the only G20 member in the Middle East.
More detail on the indicators and what they will mean is expected when G20 finance ministers and central bank officials release an official communique today. But early signs point to progress after days of tense negotiations.
Christine Lagarde, the French finance minister, said officials reached an accord after a round of "frank" discussions. "We've reached a final compromise," she said. "It wasn't easy. There were obviously different views. We worked with the objective of stable and balanced growth."
The indicators form an important part of the response of the world's largest economies to a crisis that many blame partly on imbalances. They are also a means of singling out protectionist political and economic policies that have become a growing concern as countries try to shield strategic domestic industries in response to the crisis.
An indicator focusing on currency reserves and foreign exchange rates has been closely watched for signs of capitulation by China to western countries' demands that it allow its yuan to strengthen. China has long intervened in markets to keep the yuan weak in an effort to stimulate exports - with a cheaper local currency, Chinese goods become less expensive for foreigners. But that policy has also made other countries' exports less competitive at a time when many are searching for economic growth through sales of their goods overseas.
* with agencies
