updated 9/3/2009 1:02:03 PM ET 2009-09-03T17:02:03

Top finance officials at a Group of 20 meeting in London are expected to stress their commitment to boosting the global economy for now — despite friction over when exactly to scale back stimulus efforts amid growing signs of recovery.

Finance ministers and central bankers will try to coordinate plans for an eventual winding down of the trillions of dollars of support, as well as discuss further financial reforms such as a U.S. proposal for an international accord on increasing banks' capital reserves.

Agreement is less likely on a European proposal to curb bankers' bonuses, which may run into a U.S. stumbling block.

Treasury Secretary Timothy Geithner played down expectations for major announcements from the gathering on Friday and Saturday, saying it was a step toward a meeting of G20 national leaders in Pittsburgh later in the month.

"This is a stock-taking meeting, not a new-initiatives meeting," Geithner told reporters at a briefing in Washington D.C.

The finance ministers and central bank officials from rich and developing countries representing 80 percent of world economic output are convening amid gathering indicators of an economic recovery. Japan, Germany, France and Australia all recorded growth in the second quarter while Britain is widely expected to do so in the third quarter.

But fears remain that curtailing government spending and monetary stimulus via low interest rates and money supply boosts too soon could result in a "double dip" recession.

"You're seeing the first signs of positive growth now in this country and countries around the world," said Geithner. "We've come a very long way but I think we have to be realistic, we've got a long way to go still."

British Prime Minister Gordon Brown, French President Nicolas Sarkozy and German Chancellor Angela Merkel issued a joint letter on Thursday urging the G20 to stick to stimulus plans, while avoiding future imbalances in the global economy such as excessive budget deficits.

But the London meeting will also discuss a framework for how the world's biggest economies can start to withdraw packages such as Britain's multibillion asset purchasing program to expand the money supply and the U.S. capital injection into struggling companies such as General Motors.

"The agenda has shifted from 'will we recover?' to 'how are we recovering' and, even, 'do we need to start removing stimuli?' said CentreForum economist Giles Wilkes.

The timing of so-called exit strategy is a point of contention, with Britain and the United States saying it is too early to call. German Finance Minister Peer Steinbruck recently calling for the reduction of fiscal measures as soon as possible.

"I think a lot of the meeting will be about when should we withdraw," said Wilkes. "They want to coordinate it. If it is a malcoordinated adjustment you run the risk of real dislocation."

There are also signs that the G20 might be split over how far to go with some financial system reforms, with Europe's push to prioritize the issue of bankers' bonuses not matched by the United States or other countries.

The European Union is calling for the U.S. and other G20 countries to restrict "an excessively risky bonus culture," following promises at the London G20 leaders meeting in April to pass "tough new principles on pay and compensation."

France and Germany have led by example, with France planning to ban banks from winning government contracts if they fail to agree to limits on bonuses and Germany considering laws to defer bonuses for at least four years.

Brown, Sarkozy and Merkel said in their joint letter they want the G20 to adopt "binding rules" to regulate bank behavior at the Sept. 24-25 Pittsburgh meeting.

Geithner did not raise the bonus issue at his briefing, with the United States instead focused on proposing an outline for tougher global bank capital standards that it says will make the financial system more stable by limiting the risk of large institutions failing.

Geithner said he wanted to start talks on a new international capital accord that would put in place "a more conservative framework of constraints on leverage in the financial sector across the major globally active financial institutions."

The accord would be developed under the auspices of the Financial Stability Board, Geithner said, an international body that was recently expanded to include major emerging economies such as China, India and Brazil.

Those emerging economies have their own agenda at the London meeting, most clearly a change in global regulation to give them a greater say in governance of financial markets.

The G20 countries have agreed to review the leadership of institutions like the World Bank and IMF, which has received pledges of more money to help struggling countries. The IMF is customarily headed by a European and the World Bank by an American.

Developing countries want that process to happen faster.

"The opportunity will be taken now by emerging powers to make changes," said Amir Amel-Zadeh, a finance lecturer at the University of Cambridge. "Now is the chance to change, seeing that the IMF has received larger funding to tackle the crisis."

The G20 includes 19 countries: Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey, Britain and the United States. The European Union, represented by its rotating presidency and the European Central Bank, is the 20th member.

Copyright 2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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