President George W. Bush and the G20 leaders and delegates attend the Summit on Financial Markets and the World Economy Saturday, Nov. 15, 2008, at the National Building Museum in Washington, D.C. President Bush gestures as he addresses the G20 leaders and delegates during the first Plenary Session I at the the Summit on Financial Markets and the World Economy Saturday, Nov. 15, 2008, at the National Building Museum in Washington, D.C. President Bush stands with fellow world leaders Saturday, Nov. 15, 2008, for the family photo at the Summit on Financial Markets and the World Economy at the National Building Museum in Washington, D.C.

Washington — Leaders of 20 of the world’s largest economies vowed to reform the global financial system and take action against the economic slowdown.

While they refrained from planning coordinated fiscal action, they vowed to cooperate closely as they individually pursue efforts to boost growth in their respective countries. “There was a common understanding by all of us that we should take pro-growth economic policies,” President Bush said after the meeting.

“We are determined to enhance our cooperation and work together to restore global growth and achieve needed reforms in the world's financial systems," said the final declaration from the Group of 20 (G–20), which comprises developed and emerging market countries.

G–20 members are Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey, the United Kingdom, the United States, plus the European Union.

The leaders met November 14-15 in Washington at what they are calling the first in a series of meetings to discuss measures to strengthen economic growth, deal with the financial crisis and lay the foundation for reform of the financial system to prevent a catastrophic crisis in the future.

An action plan approved by the participants calls on finance ministers to reform practices and financial markets that have exacerbated the crisis. For instance, the plan calls for boosting transparency in the sale of often-murky, complex financial products and for revising compensation and risk-taking practices. The G-20 further agreed that finance ministers must evaluate global accounting norms and the financing needs of international institutions as well as find a way to include large, emerging markets into the Financial Stability Forum, a standard-setting body established by the Group of Seven industrialized countries in the late 1990s.

By April 30, 2009, the date the leaders have chosen to meet again, finance ministers must compile a list of financial institutions whose collapse might imperil the global financial system.

To increase chances of successful outcomes of the reforms, the G–20 leaders vowed to abide by free-market principles in their pursuits. Specifically, they pledged to give the stalled Doha round of World Trade Organization negotiations another try after several earlier, unsuccessful attempts to revive them. They also pledged to refrain from imposing new trade or investment barriers for the next 12 months.

Before a November 15 plenary session, President Bush said: “One of the dangers during a crisis such as this is that people will start implementing protectionist policies."

According to many experts, protectionist policies of the United States and other countries in the 1930s made economic and financial crises so much worse that they turned into the Great Depression.

According to the latest economic forecasts from the Organisation for Economic Co-operation and Development and the International Monetary Fund, economies of the developed world will contract and fast-growing emerging market economic, such as those in China and India, will slow in 2009.

The leaders pledged to ensure that sufficient resources are available at multinational financial institutions to assist developing countries harmed by the crisis.

The meeting — cast by some countries as a platform for launching a far-reaching overhaul of the global financial architecture — settled for a more cautious, gradual approach to improving the regulation and functioning of financial markets. Key principles that were agreed upon include strengthening transparency in financial transactions, accountability and regulation; harmonizing national regulations; promoting integrity and regulatory cooperation; and providing the International Monetary Fund with capabilities to set up a financial early-warning system and to play a bigger role in crisis response.

Before the summit, France’s president, Nicolas Sarkozy, called for financial regulation that applies across national borders. Despite some G–20 leaders having envisioned at least some regulatory convergence, the meeting consensus was that regulation remains a domain of national authorities, which “constitute the first line of defense against market instability."

The full texts of the declaration and a White House fact sheet are available on the White House Web site.