Time for a new tack to get the global economy moving

STEP down, central bank governors; and step up, finance ministers and market traders. Could this be the new order that is going to rescue the global economy from the danger of slowing "below stalling speed" (to borrow a phrase used this week by the International Monetary Fund) and to set advanced and emerging economies alike on a path to recovery?

Many analysts and other observers have been so fixated on the drawn-out drama of monetary easing by the world's leading central banks that they have failed to spot something which BT (for one) has drawn attention to: the nascent shift in policy emphasis from monetary expansion to fiscal stimulus. And they have also failed to register sufficiently strongly the fact that commodity prices (led by oil) are at last pulling out of a prolonged dip that has been all but disastrous for commodity-producing countries, while not creating hoped-for "growth dividends" in advanced nations.

As BT reported recently, the Group of Seven (G-7) summit due to be held in Japan in June is expected to endorse a group-wide and potentially very large boost in fiscal spending by member governments (the US, Canada, Japan, Germany, France, Britain and Italy). The odds of this happening were perceived to have been boosted on Wednesday when the secretary-general of the Organisation for Economic Co-operation and Development (OECD) Angel Gurria called on G-7 heads in Tokyo to engage in just such a boost in collective fiscal spending.