Reforms of the Group of Eight (G8) club of major industrialised nations must be studied to make it more inclusive of emerging countries, European Union president France has proposed to the bloc's finance ministers. "Further reform of the G8 should be considered to make this group more inclusive of emerging countries," the document, obtained by Reuters before it is due to be discussed at a regular meeting in Brussels next Tuesday, said.
The document is key to formulating the EU's position for the G20 summit to be held in Washington on November 15 to apply lessons learnt from the worst financial market crisis since the Great Depression. Several leaders such as British Prime Minister Gordon Brown and French President Nicolas Sarkozy have called for a "Bretton Woods"-style reworking of how global capital markets are supervised.
EU finance ministers will discuss the document next Tuesday with its proposals feeding into an EU summit on Friday, eight days before the Washington G20 meeting. The document makes other key proposals touching on how to reform oversight of big banks that straddle many national markets and on the internal workings of banks, whose own procedures to limit risk have been found wanting.
"Supervisory colleges should be rapidly established for all significant cross-border firms to ensure effective oversight," the document said. "Risk control mechanisms in financial institutions should be enhanced and placed under direct responsibility of senior management, notably to prevent significant operational incidents in market operations," it added.
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