In an exclusive interview with the London Summit website, Alistair Darling, the British Chancellor, said there was a growing consensus about the need for countries to take action to boost economic demand and clean out their banking systems. He was speaking as President Barack Obama said the US had two goals at the G20 - to ensure joint action to jump-start economies and to move forward on a regulatory reform agenda.

Mr Darling said there was agreement in both Europe and America for the two actions that were needed to resolve the financial crisis. 'One is to make sure that we do support our economies with a fiscal stimulus that people have been talking about,' he said. 'Secondly and this is critical is to clean up the banks' balance sheets and ensure that banks can start to be effective and start lending into the economy again.' He said that fixing the banks was essential to fixing the economies.

It was now clear that the solution needed the cooperation of advanced, emerging and developing countries, said Mr Darling. 'They recognise that we are all in it together and that no country can go it alone. In the past the more developed countries would have thought they could sort all this out themselves. Now we need the emerging economies, we need the developing economies to be in here. We all need to come together.

The Chancellor said that the 'process' of finding solutions would begin at this weekend's meeting of the G20 finance ministers and central bankers. 'We hope that at the beginning of April we have very clear, concrete proposals that will help countries work together,' he said. He said that countries needed to realise that 'this is one of those few occasions that occur in a century where action is needed and action is needed immediately and we need to take action together and it can make a real difference to the people who sent us here'.

Mr Darling called for a 'substantial increase' in the resources available to the International Monetary Fund to ensure they can intervene at an early stage to help countries in trouble. He said reform of governance of the IMF and World Bank was 'important' and that countries should have their say but appealed to governments not to 'waste time talking about constitutions'.

The Chancellor said that all countries recognised that erecting trade barriers would be 'disastrous' as it was in the 1930s. He warned about the risks of unintended protectionism where countries too action to provide help to their citizens that inadvertently harmed others. 'Our next door neighbour is very important but our next door neighbour is now someone living on the other side of the world as well as someone living down out street so it is very important that we reject any form of barriers to trade.'

 

Finance ministers and central bankers of the G20 group of developed and emerging nations are meeting in Horsham, southern England on 13 and 14 March to prepare the ground for the London Summit on 2 April. Speaking in Washington during a meeting with US Treasury Secretary Timothy Geithner, who will take part in the meeting, President Barack Obama said America would call on other countries to take economic stimulus measures while working together to tackle financial regulatory reform. 'We've got two goals in the G20. The first is to make sure that there is concerted action around the globe to jumpstart the economy. The second goal is to make sure that we are moving forward on a regulatory reform agenda,' Mr Obama said.

Later Tim Geithner, the Treasury Secretary proposed several funding increases for the IMF that could increase its lending war chest to as much as $1 trillion rather than the $500bn that the Fund has suggested. He also urged the Group of 20 nations  to take 'forceful' actions to end the financial crisis. 'G-20 countries must take strong macroeconomic and financial sector measures.' A 'reasonable benchmark' is the IMF's recommendation for stimulus equivalent to 2% of a nation’s economic output, Geithner said.