FINANCE leaders from the Group of 20 (G20) agreed on realizing a well calibrated, well planned, and well communicated normalization in the monetary policy to minimize the impacts of the U.S. Federal Reserve’s upcoming interest rate hikes.

The consensus was made Friday evening during the second day of the G20 Finance Ministers and Central Bank Governors (FMCBG) meeting in Jakarta, with Indonesia serving as the host country.

Bank Indonesia’s Governor Perry Warjiyo told a press conference that developed countries should ensure that the normalization policy only posed minimum impacts to the global financial market and that it did not pose any spillover effect to developing countries.

“This is an urgently important thing to do, so that the global economy can return to a long-term growth and the scar caused by the COVID-19 pandemic can be healed faster,” Warjiyo said.

The U.S. Federal Reserve has recently said that the central bank would have to raise interest rates up “more aggressively,” expecting “four, maybe five hikes” this year, which was expected to impact the debt condition or the financial stability of other countries, especially emerging economies.

Indonesia’s central bank has also moved to curb inflation, including by promoting the use of local currency settlement in cross-border trade and investment, as an effort to reduce dependency on the U.S. dollar.

Warjiyo said that the FMCBG meeting also discussed broader issues related to the global financial sector, risks in global supply chains and energy issues.

On Friday, the G20 members has also issued a joint commitment to ensure aid and support for poor and developing economies to assist their recovery from the COVID-19 pandemic.

The G20 members are committed to ensuring “access to safe, timely, equitable, and affordable vaccines, especially for low and middle-income countries,” Warjiyo read out the written joint statement in a press conference.

The statement also called for the members to contribute to the “strengthening of the global health architecture.”

The G20 members recognized that the global economic recovery is ongoing, but at a different pace among countries.

Rising food and energy prices, potential interest rate hikes, supply chain disruptions, climate change disasters, and rising geopolitical tensions are among factors contributing to uneven recovery, according to the joint statement.

After the COVID-19 outbreak, the G20 economies have provided support for emerging economies through debt suspension and external debt restructuring to poor and developing countries to back their capacity in handling the pandemic and increase debt management capacity, so that they can expedite their economic recovery.(SD-Xinhua)