BRUSSELS (Reuters) - Financial leaders of the world's 20 largest economies (G20)expect a modest pick-up of global growth this year and next, but see the coronavirus epidemic as a downside risk, a draft communique prepared for the meeting on Feb 22-23 said.
G20 finance ministers and central bank governors meet on Saturday and Sunday in Riyadh to discuss the global economy, as China grapples with a virus that has killed more than 2,000 people and forced drastic curbs on travel and commerce.
"After signs of stabilisation at the end of 2019, global economic growth is expected to pick up modestly in 2020 and 2021. The recovery is supported by the continuation of accommodative financial conditions and some signs of easing trade tensions," the draft, seen by Reuters, said.
"However, global economic growth remains slow and downside risks to the outlook persist, including those arising from the impact of the novel coronavirus outbreak, geopolitical tensions and policy uncertainty," said the draft, which may still be changed before the final version is adopted on Sunday.
The financial leaders will endorse G20 summit conclusions from last year that they would strive for a "free, fair, non-discriminatory, transparent, predictable and stable trade and investment environment", and keep their markets open.
The draft also said the ministers and central bankers will stand by earlier statements that flexible exchange rates, where feasible, can serve as a shock absorber, and that excessive volatility or disorderly movements in exchange rates can have adverse implications for economic and financial stability.
The G20 will say the members will refrain from competitive devaluations, and will not target exchange rates for competitive purposes, the draft showed.
The draft will also include a political endorsement of the OECD's agreement at a technical level last month on global tax rules for digital companies such as Google (O:GOOGL), Facebook (O:FB), Amazon (O:AMZN), Apple (O:AAPL) or Alibaba (N:BABA), a senior G20 official said.