SEOUL, Nov. 12 (Yonhap) -- South Korea and its efforts to represent the interest of poor nations at the summit of the Group of 20 major economies received the international spotlight as G-20 leaders endorsed Seoul's proposal to establish global financial safety nets and development goals to better assist developing economies.
In a joint declaration released Friday at the end of the Seoul summit, G-20 leaders pledged their commitment to the strengthening of the global financial safety nets, noting they will "help countries cope with financial volatility by providing them with practical tools to overcome sudden reversals of international capital flows."
The proposal to enhance the global financial safety nets was made some six months ago by Seoul as part of what it called the "Korea Initiative." Developing or underdeveloped nations are especially vulnerable to capital flow reversals as investors are prone to pull out their investments first from weaker economies in times of crises.
The endorsement of the Korea Initiative by G-20 leaders also highlighted Seoul's self-imposed role as a bridge between developed and emerging nations as it had to convince the G-20 and other developed nations why they should agree to relatively reduced coverage from the International Monetary Fund (IMF).
South Korean President Lee Myung-bak holds a press conference following the conclusion of the Seoul G-20 summit on Nov. 12. (Yonhap)
The IMF agreed in August to increase the duration and credit available under the flexible credit line (FCL) and establish a precautionary credit line, which will provide coverage to countries that do not qualify for the FCL.
Assurances offered by the new and improved financial safety nets will also help diminish countries' urges to excessively accumulate precautionary reserves that are costly for both national and global economies.
Under the Korea Initiative, Seoul also proposed establishing a new framework for development that will address nine key issues ranging from infrastructure and human resources development to trade, food security and job creation.
The development agenda, as advocated by South Korea, starts from the view that developing or underdeveloped countries are an important part of the global economy that cannot be discarded for sustainable and continued -- as well as balanced -- growth of the world.
As the world's 20 largest developed and emerging economies, G-20 nations account for about 85 percent of global production and nearly the same amount of trade, but they alone cannot ensure the successful implementation of decisions by their leaders without the support of some 200 other countries in the world.
The G-20 leaders at the Seoul summit wholly approved the development agenda along with the nine key areas of development identified by a G-20 developing working group established at the Toronto summit and chaired by South Korea and South Africa.
"We recognize the importance of addressing the concerns of the most vulnerable. To this end, we are determined to put jobs at the heart of the recovery, to provide social protection, decent work and also to ensure accelerated growth in low-income countries (LICs)," the leaders said in their joint declaration.
In addition, the G-20 heads of state endorsed what they named the "Seoul Development Consensus for Shared Growth" and a multi-year action plan that calls for efforts to support developing economies and LICs in all nine areas identified by the development working group.
"We commit to and prioritize full, timely and effective implementation of the multi-year action plan, understanding its high potential to have a positive transformative impact on people's lives, both through our individual and collective actions and in partnership with other global development stakeholders," they said.