1. Ministers and Governors met today, October 7, 1995, to review current global economic and financial conditions and assess progress in implementing the reform of the international architecture called for by leaders at the Halifax Summit. The Ministers and Governors, joined by representatives of the European Commission, also met with Russian officials to discuss policies of the Russian Federation.

2. Ministers and Governors agreed that in most countries the conditions for continued growth and employment gains are in place and inflation is well under control or declining. The constructive monetary and fiscal policy measures outlined and/or implemented in recent months have contributed to this improved outlook, as have the general movements in exchange rates since their April meeting.

3. Ministers and Governors agreed that policies should continue to be aimed at sustaining non-inflationary growth. A sustained and broad-based expansion will create jobs, reduce external imbalances, and contribute to financial market stability.

4. Ministers and Governors recognized that significant and durable progress in reducing fiscal deficits has been achieved in some countries, while others have or will shortly have initiated comprehensive reduction measures. They also emphasized that further substantial deficit reduction over the medium-term in their countries is essential in order to promote savings, support higher levels of investment and raise long-term growth prospects.

5. Ministers and Governors welcomed the orderly reversal in the movements of the major currencies that began following their April meeting. They would welcome a continuation of these trends consistent with underlying economic fundamentals. They reaffirmed their commitment to reduce imbalances and to cooperate closely in exchange markets.

6. Ministers and Governors reviewed the efforts underway to implement the mandate of leaders at the Halifax Summit to strengthen the international monetary system, including its capacity to prevent and where necessary respond to crisis. They look forward to progress in areas recognized as crucial at the Halifax Summit, including disclosure, surveillance, emergency finance, the review of procedures for addressing sovereign liquidity crises, financial market regulation, multilateral debt, and cooperation in countries emerging from economic and political crises.

7. Ministers and Governors took note of diplomatic efforts to promote a comprehensive peace settlement in Bosnia. Ministers and Governors urged the IMF and World Bank to conduct expeditiously a thorough needs assessment so that the international community can respond quickly, flexibly, and on suitable terms as soon as conditions warrant.

8. Ministers and Governors, joined by representatives of the European Commission, met with Russian officials, led by First Deputy Prime Minister Chubays. They agreed that benefits of Russia's strong policy performance this year are becoming increasingly evident. These policies have been supported by the IMF under a $6.8 billion standby arrangement and by a $6.4 billion Paris Club debt rescheduling. Ministers and Governors urged Russia to adhere to its stabilization program and intensify structural reforms, especially privatization. They also urged Russian and the IMF to work on an extended arrangement. They reaffirmed their readiness to begin negotiations later this fall on a comprehensive rescheduling which addresses Russia's medium-term debt problems, based on successful continuing implementation of the standby program.

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Source: Canada Department of Finance