Finance ministers from the world's leading nations sought Saturday to narrow differences on key banking reforms before wrapping up a two-day meeting aimed at safeguarding a fragile recovery.
The G20 ministers meeting in South Korea's southern port city of Busan are engaged in a delicate balancing act: nursing a fragile global recovery from the 2008-9 crisis while reining in massive deficits in some member nations.
The issue of new capital and liquidity standards for banks has been divisive going into the meeting, but signs emerged that the group was edging towards consensus in allowing more time for implementation.
"I think that can be worked out over time. There could be a compromise over that," Canadian Finance Minister Jim Flaherty told reporters.
The International Monetary Fund is expected to present a revised draft proposal on a banking tax at the meeting, which is being held to prepare for a Toronto summit on June 26-27.
Many argue more time is needed to assess the implications of tighter banking requirements and how any global standard can be reconciled with an array of different national regulatory plans and tax regimes.
"I hope we will reach a consensus on principles. But as for the timing, we will see," French economy minister Christine Lagarde said late Friday, adding it was "an open secret" that Canada and Australia oppose rushing a bank tax.
The proposed global tax is supported by European powers and the United States but resisted by some developing nations plus Canada and Australia, who argue that they should not have to pay to clear up a mess they did not create.
However, such opposition is "short-sighted", said one official who did not wish to be named.
"The argument that "˜we didn't have a crisis, so we don't have to do anything' is very short-sighted. You didn't but you might next time," the official said.
"In the same way traffic laws are designed to guarantee safety, there are enforcement mechanisms and still there are traffic accidents. You can't design a system where there are no accidents."
US Treasury Secretary Timothy Geithner this week said it would be "perfectly reasonable to use transition periods to make it easier for countries to adjust" to stricter banking rules.
The eurozone debt crisis has cast doubt over the durability of a fragile global economic recovery, with ministers at the Busan meeting working to prepare a path towards sustainable and balanced growth.
Markets remain ruffled despite the European Union's move to craft a â‚¬750-billion (US$913 billion) rescue plan and a European Central Bank effort to buy the bonds of troubled countries such as Greece.