That function for more than three decades had been performed by a smaller club of leading industrial countries known as the G8.
On Thursday, September 24, Brazilian president Luiz Inácio Lula da Silva had asked that the G20 replace the G8 as the main forum for the world leadership. He argued that it was time that the emerging countries have their say at the table with the richer nations.
"I believe there is no reason for a G8 or any other G except the G20," said Lula in a TV interview in the United States with Jim Lehrer in his PBS Program "The News Hour."
"I believe that we should assure that the G20 should be from now on an important forum to discuss the world's main economic decisions," he added.
Brazil, China and India should have a bigger voice on world issues because they are large consumers and producers and "we are better prepared than the rich countries for this crisis," continued the president.
Brazil, China and India belong to the G20, but not the G8 which is made up by the US, the United Kingdom, Germany, France, Italy, Japan, Canada and Russia. The G20 is represented by the 19 world's largest economies plus the European Union.
Lula also asked the G20 leaders to hasten the review of the global financial rules, strengthen the banks capital standards and get rid of fiscal paradises.
"We need to use this crisis and to things the right way,"he concluded.
The G20 also agreed on a 5 percentage point shift in International Monetary Fund voting power from controlling developed countries to underrepresented countries, G20 sources said. The move is part of efforts to give emerging economic powers more say in the IMF to recognize their growing influence in the world economy.
World leaders closed in on a statement urging new restraints on bankers' pay, a flashpoint for outrage in the global financial crisis. The statement, however, was not expected to include specific monetary caps on pay, accommodating the United States' insistence that such limits would be a deal-breaker.
G20 policy experts are urging their leaders to approve measures such as clawing back salaries for poor performance and paying some bonuses in stock, an official said.
High levels of compensation, such as giving multi-million dollar bonuses to executives even at money-losing financial firms, have outraged political leaders and become a target for advocates of tighter oversight of banks and capital markets.
"Europeans are horrified by banks, some reliant on taxpayers' money, once again paying exorbitant bonuses," said European Commission President José Manuel Barroso.
"In Pittsburgh, the EU will call for coordinated action to stop this, building on measures already taken in Europe and elsewhere," he said in a statement before the summit opened.
A storm of controversy erupted in March over millions of dollars in bonuses paid to executives at bailed out insurance giant American International Group, prompting President Barack Obama to call out-sized bonuses "just not acceptable."
Wall Street giant Goldman Sachs further inflamed the issue in July by saying it had set aside 11.3 billion USD for compensation in the first half of 2009, just months after getting a 10-billion taxpayer bailout, which it has since paid back.
G20 officials were focused on finding ways to link a bank's bonus pool and executive compensation more closely to the health of its balance sheet and overall profitability.
Bzz/Mercopress