British PM Brown seeks coordinated G20 action on growth

LONDON, Sept 1 - British Prime Minister Gordon Brown has called for greater international coordination to ensure the world economy can return to sustained growth following the financial crisis.

"The challenge building in London and Pittsburgh is to achieve a level of economic cooperation that will stand us in good stead as we move through the next year," Brown said in an interview with the Financial Times.

"We need to be clear about how we can return the world economy to durable growth -- I am thinking particularly of the industrialised countries as far as the levels of growth are concerned, but obviously to the high levels of growth that people need to see in other parts of the world as well," he said.

Brown was speaking ahead of a meeting in London this week of finance ministers from the Group of 20 (G20) club of industrialised and emerging nations. The London meeting is to prepare the ground for a summit of G20 leaders in the U.S. city of Pittsburgh on Sept. 24-25.

Brown said the big challenges for Pittsburgh were to build on efforts to restore trust in the financial sector, identify sources of future growth and improve global coordination to achieve this.

"There has to be more cooperation in the future, not less, and this new way of governing the world economy, whatever it is called -- some people talk about a compact for growth over the next year -- is a necessary element of all countries coming through this very, very difficult period," Brown said.

He said there should be certain "trigger points" at which action was taken on a global level to prevent a repeat of last year's banking meltdown and financial crisis.

"If imbalances reached a certain level, then we should be prepared to deal with problems that arise for surplus and deficit countries," he said.

"If, for example, we don't see distressed assets being cleaned up quickly enough by certain countries, or certain financial authorities, then we have got to consider that the world will act to make sure that people accept the responsibility that action has got to be taken in these circumstances."

A G7 source told Reuters last week that the G20 finance ministers, meeting on Sept. 4 and 5, would likely pledge to maintain accomodative policies for as long as is needed. [ID:nLR271000]

Separately, a UK government source last week said G20 countries should ensure they have plans to withdraw the huge stimuli put into their economies but were clear the fiscal and monetary boosts remain in place for now.

Brown also pledged action on excessive rewards for bankers in his interview. [ID:nLV381586].

Brown chaired the previous summit of G20 leaders in April at which more than one trillion dollars was pledged to help the world pull out of the worst recession for decades.