Canada’s Flaherty Says G-20 to Discuss Fiscal Targets

Group of 20 officials will discuss this week whether they need to set new fiscal targets for their governments, Canadian Finance Minister Jim Flaherty said.

Flaherty, speaking to reporters ahead of meetings of finance ministers and central bankers from the G-20 in Washington today and tomorrow, said he supports targets because they help establish “fiscal discipline.” He also said that it was his “impression” the U.S. is opposed to such targets.

At a February meeting in Moscow, G-20 officials accepted the U.S. position by not setting new targets to replace those they had agreed on in 2010, which many of them are on course to miss. They pledged instead to develop “credible medium-term fiscal strategies.”

“We’ll see what the different views are around the table about hard targets,” Flaherty said. “I do worry about the credibility of the G-20.”

Flaherty said he discussed fiscal policy issues at a meeting today with Treasury Secretary Jacob J. Lew, where he also advocated for TransCanada Corp.’s Keystone XL pipeline. He told Lew the project would benefit both economies and moving the oil by rail would be even worse for the environment. President Barack Obama has said he will make a decision on the project by the end of the year.

While he declined to comment on his search for a new Bank of Canada governor, Flaherty said he is looking for an “excellent” replacement and that he has some “very good candidates.” The current governor, Mark Carney, is leaving for the Bank of England in June.