Finance 20 Leaders Disagree On Government Spending

Economic leaders from the world's richest countries are meeting in London, where they are working to resolve deep divisions on how to reverse the global recession.

Finance ministers and central bankers from the Group of 20 nations are holding round-table talks Saturday, after meeting one-on-one Friday.

U.S. and European leaders disagree on whether more government spending is needed to stimulate the economy or if tighter regulation of the financial markets is more urgently needed.

The United States is pressing for a coordinated stimulus effort and lower taxes. But European leaders want to focus on reforming the financial system with tighter rules on banks, tax havens and hedge funds.

World Bank President Robert Zoellick warned Friday that a stimulus plan without efforts to stabilize the banking sector will amount to a "sugar high" for the global economy and not provide lasting benefits.

Zoellick urged the world's leading industrialized and developing economies to take strong and effective action, calling this a "dangerous" year for the economy.

The group is expected to back calls to double the International Monetary Fund's resources and expand the lender's powers to help emerging economies.

The G-20 talks set the stage for a summit of national leaders scheduled for April 2.

By VOA News.