This  weekend,  leadersand top finance officials fromthe  world’s  twenty  biggesteconomies gather in Toronto,Canada. One of the big issuesto discuss is how and when toreduce deficits and economicgrowth measures as conditionsimprove.

Chancellor Angela Merkel is defending Germany’s decision to cutspending by one hundred billion dollars over four years. But some expertssay the world economy is still too weak for Europe’s biggest country toreduce spending.

Earlier this year, Germany was slow to react to the Greek debt crisis.

European countries later had to agree to a nearly onetrillion dollar rescuefor the euro area.

Other  countries  including  Britain,  France  and  Japan  have  alsoannounced cuts. But American Treasury Secretary Tim Geithner says:

“Without growth now, deficits will rise further and undermine futuregrowth.”

Economists also point out that spending cuts alone do not solve theproblems of countries withstructural economic problemsG-20  nations  are  alsostruggling with financial reformissues. These include new rulesfor risky financial products andclosersupervision of banks.

This week, Britain’s financeminister announced a new tax onbig banks. Germany and Franceare considering similar measuresto pay for future financial problems. President Obamaproposed the idea forthe United States in January. But how many countries will join Britain is notclear.

Nineteen countries and the European Union form the Group of 20,including developing economies like Brazil, China, India and Russia.

Economist Sebastian Mallaby at the Council on Foreign Relations saysG-20 nations should work together on financial reforms.

Sebastian Mallaby: “Financialinstitutions arecross-border, they aremulti-national, they are global. So you ought to have global rules to try anddeal with them. But that is not the way the Congress is dealing with them inthe United States, and that is not the way I expect Europeanregulators willgo either.”

G-20 nations also face the issue of trade imbalances, like the onebetween the United States and China. As recently as last week China. 　　

said it would not discuss thedispute over its currency atthe Toronto summit. But lastSaturday China announced itwill slowly let the value of theyuan rise. This week, it reachedits highest exchange rate in twoyears.

China’s export prices may rise, but an American diplomat said theaction “takes an irritant off the table in the U.S.-China relationship.”