On the eve of the G20 summit slated for Thursday in London, major developed and developing countries have come up with a host of proposals for tackling the current financial crisis and economic downturn.

At the summit, participating leaders are expected to seek agreement on what fiscal and monetary measures should be adopted to restore growth, what regulatory changes are needed to make to the financial system, and how to reform such international organizations as the International Monetary Fund (IMF) and the World Bank.

While the two major economies in the G20 bloc, the US and the European Union (EU) share consensus over the above issues, they differ over which goes first and how to implement the measures.

The US is eager to put economic stimulus measures on the top agenda of the summit, fearing being slow in action would risk further economic slumps. US Secretary of Treasurer Timothy Geithner recently called on other countries to commit two percent of their GDP to extra spending to stimulate growth.

The EU, on the other hand, holds a much cooler stance, saying there is no need for new fiscal stimulus measures. Instead, it proposes strengthening fiscal surveillance, reforming the international financial system, and establishing a more efficient surveillance system.

The two economic powers also differ over the amount of funding needed to replenish IMF resources. The US favors a trebling of the existing US$250-billion fund the IMF has now at its disposal to support struggling economies, indicating the US could contribute up to US$100 billion.

The IMF and European leaders want to see IMF resources doubled and the EU is prepared to offer 75 billion euros (about US$99 billion). Japan has offered US$100 billion and China has also given a positive response to the proposal.

Japanese Finance Minister Yosano Kaoru has recently said Tokyo was considering introducing a large-scale economic stimulus package worth over two percent of its GDP.

Japanese Prime Minister Aso Taro said a few days ago that he would require the international financial organizations to enhance supervision over financial derivatives at the London summit, and to increase the fund resources for the international organizations such as the IMF.