Finance ministers from the world’s leading economies are meeting at the G20 summit in Berlin this weekend. On their minds: the falling dollar and the effects of globalisation. Allan Greenspan, chairman of the US Federal Reserve, has already warned that the US’s current account deficit is unsustainable.
The US now owes other states more than five percent of what it produces annually in GDP. Opening the meeting Germany’s Finance Minister Hans Eichel talked of the need to agree on a problem solving mechanism: “We need an answer to the question how can we establish a working international framework for the solution of global problems? With this logic we also have to discuss the problem of the nation state. Debates about the worldwide consequences of globalisation show that many people fear the laws of national sovereignty. My estimate is that global problems won’t be solved without strong nation states in the future.” EU officials are also alarmed at the euro’s strength against the dollar, but economists believe President Bush likes a weak dollar because it helps American exporters.