The G20 summit in Los Cabos, Mexico, has ended with a declaration against protectionism and for growth. The leaders of the world's 20 largest economies focused their attention on the crisis gripping the eurozone.
International Monetary Fund (IMF) chief Christine Largarde was relieved about the promises made at the G20 summit. IMF resources are set to be beefed up by some $456 billion (360 billion euros). The money is not explicitly earmarked for bailing out ailing eurozone countries, but it can be put to that use. Lagarde said she left Los Cabos with a sense that the G20 nations had moved closer together.
In their closing statement, the eurozone countries promised to take whatever measures necessary to maintain the stability and integrity of the region and to keep financial markets functioning.
US President Barack Obama also applauded the European effort. He said there was no doubt that all countries in Europe understood that growth strategies would have to go together with consolidation plans. The US would have to adopt similar measures, Obama said.
"None of them are going to be a silver bullet that solves this thing entirely ... in the next week or two weeks or two months, but each step points to the fact that Europe is moving towards further integration rather than break-up," Obama told reporters.
Markets pressured Merkel
Robert Shapiro, a former US undersecretary for commerce, said it was market pressure that would lead to a change of tack in Europe - particularly when it comes to German Chancellor Angela Merkel. Shapiro, who served under former US President Bill Clinton and is currently an advisor to Obama, said the G20 summit was successful because the chancellor altered her position.
"For the first time, she agreed, begrudgingly, that the eurozone's money could be used to balance Spanish and Italian accounts," he told DW.
Obama, along with leading politicians in the eurozone, has worked for months to convince Merkel to enact the measures necessary to prevent the euro's collapse, Shapiro said. Greek voters over the weekend narrowly lent their support to pro-bailout parties, which gives Merkel more room to maneuver, he added.
After having called on Germany to do more to fight the euro crisis, British Prime Minister David Cameron gave his support to Merkel.
"A successful eurozone depends on each of its members being prepared to take some very difficult decisions," he said, adding that it did not make sense for one country to bear all the responsibility for the common currency's difficulties.
French President Francois Hollande expressed his solidarity with Merkel earlier in the day.
"Madame Merkel and I agree that Europe needs to find its own answers and that these answers should not come from outside parties," he said.
He added that France and Germany have to cooperate because of the importance in the European Union and their economic strength.
Political support for euro
For her part, Merkel said the message to take away from Los Cabos was that the eurozone nations gave their political support to the shared currency. She said discussions took place concerning a "European institution that would embody the supervision of banks" and "more measures for growth, the adoption of guidelines for shared standards for deposit guarantees and bank reorganization."
John Kirton of the G20 research group at the University of Toronto called the summit a success.
"The G20 leaders recognized the challenges of the euro crisis and put forth concrete, quick and detailed steps that were badly needed," he said, adding that a key measure would be the creation of a banking union to guarantee deposits and to supervise and regulate banks.
Author: Christina Bergmann, Los Cabos, Mexico / sms
Editor: Joanna Impey