Why does tight control over government budgetary positions matter so much? As I said before, governments have made remarkable progress in recent years in reducing deficits and bringing down the national debt relative to the size of our economy - the debt-to-GDP ratio. But this ratio is still high.
This is a precondition for preventing competitive distortions as a result of international regulatory arbitrage or gaps in regulation. Solo attempts for single nations are non-viable options. I therefore strongly welcome the fact that the G20 has become established as the central forum for international cooperation, and that the Financial Stability Board (FSB) has assumed a pivotal role in the international debate on regulation.