World leaders agreed that the global economy is too unstable to begin rolling back massive fiscal stimulus plans in the near future, according to a draft of the Group of Eight statement on the world economy obtained by The Associated Press.
The leaders, however, are committing to prepare exit strategies from the "unprecedented and concerted action" that has been taken. Germany, worried about running up crippling debt, has pressed for spending restraint, while other major economies like Britain, Japan and the United States can't rule out the need to pump in more money.
"We will take, individually and collectively, the necessary steps to return the global economy to a strong, stable and sustainable growth path," the draft communique said.
The measures include continuing their stimulus packages while keeping inflation under control, a particular German concern, while also ensuring that banks have enough cash to keep lending.
In the meantime, the countries will prepare exit strategies, with the help of the International Monetary Fund, which will vary from country to country as the measures themselves have, the draft said.
The leaders gathered Wednesday in the quake-devastated central Italian city of L'Aquila, where they also wrestled over a potential landmark agreement on limiting the global rise in temperature. Over dinner later, they planned to turn their attention to world security issues from Iran to North Korea.
Italian host, Premier Silvio Berlusconi, welcomed the leaders, many of whom arrived at the summit in electric cars bearing their nation's flag. President Barack Obama strolled into the summit site for the first G-8 meeting of his presidency.
The abrupt return home of Chinese President Hu Jintao after ethnic tensions soared in China's western Xingjiang territory could weaken trust-building discussions on making further progress on climate change.
China is among five developing market economies — along with Brazil, India, Mexico and South Africa — who are participating in the summit for the fifth straight year, joining from Thursday to discuss bringing them on board, aid and development. Also joining are nine African nations and a forum on climate change.
The summit will also discussion ways to widen Group of Eight even further amid growing sentiment that world's most-industrialized nations can no longer claim leadership on the global political and economic agenda.
Obama signed an $787 billion economic stimulus bill in February, but experts say only about 15 percent of that has made its way into the economy so far — creating a debate between the wait-and-see camp and economists who urge another stimulus, arguing the recession proved to be deeper and more devastating than originally believed.
White House press secretary Robert Gibbs said Obama is satisfied with the recovery steps taken thus far but "won't hesitate" to take others if he thinks they are necessary. "He is not ruling anything out. But at the same time, he's not ruling anything in," Gibbs told reporters traveling with the president.
In the draft, the leaders also called on experts at the International Energy Forum to look at how they can dampen volatility in oil prices. France and Britain had sought the intervention of regulators to reduce what they called "damaging speculation" in oil futures markets. Oil prices have plunged from around $147 a barrel last July to $32 late last year, then to $73 last week.
U.S. regulators will examine whether the government should impose limits on the number of futures contracts in oil and other energy commodities held by speculative traders, the head of the Commodity Futures Trading Commission said Tuesday.