The Canadian Press

Canada believes time is running out for meaningful reforms to the world financial system to avert future economic meltdowns and will push for movement on the issue at next month’s G7 finance ministers meeting in Iqaluit.

Canadian officials briefing reporters on what is likely to be the most unusual G7 meeting ever say signs of hubris are again apparent among many of the global financiers blamed for plunging the world into recession.

Finance Minister Jim Flaherty is hoping that holding the meeting in isolated Iqaluit in the middle of winter will concentrate minds and lead to a renewed commitment to implement reforms.

The officials, speaking on background, said Monday that Flaherty is concerned that the momentum for reform of the world’s financial and banking sectors is waning as the economic crisis recedes.

The United Kingdom has imposed a punitive tax on executive bonuses, and the United States is also proposing to tax its largest banks. But system reform, such as ensuring risk is properly assessed, still remains to be implemented.

Canada believes the G7 countries have the primary responsibility for ensuring abuses are not repeated since the crisis originated within the world’s leading economies, the officials said.

The Iqaluit meeting in early February will be the first since the larger Group of 20 forum was declared the pre-eminent body for dealing with the world’s economic and financial problems.

And it will be unusual not just for its location, but also for its form.

Unlike past meetings, there will be no final communique issued of policies adopted in principle by the ministers and central bank governors.

By making the meetings more informal, the officials say Flaherty hopes they will be more frank and useful and prove that the G7 club is worth preserving.

One official said the necessity of producing a communique, or final concluding text, tends to concentrate discussions along producing unanimity. Freed of the need to produce a text, ministers and governors can engage in a more free-wheeling, frank and political discussion.

One of those discussions will actually be held by a roaring fire, the official said.

The future of the G7, whether it will remain as a separate institution or becomes a sub-grouping of the larger G20, remains up in the air and will be an issue before the ministers and governors in Iqaluit.

One reason it’s important to Canada that the G7 remain an influential institution is that collapsing the group into the larger G20 dilutes the country’s influence at the top table.

The officials say the Feb. 5-6 meeting in Iqaluit will tackle the gamut of issues dealing with the global economy, including ensuring the recovery is sustainable, exit strategies from government stimulus spending, global imbalances, currency exchange rates and trade.

One agenda item was added in the past week — Haiti — since the G7 countries are the biggest donors to the earthquake-devastated nation’s relief effort.

Flaherty has indicated that with relief efforts underway, the G7 meeting would be an ideal time to begin exploring how countries can help Haiti reconstruct and recover from the disaster.

The meeting’s unusual location, above the treeline in the middle of winter, has also necessitated contingency plans in case of inclement weather.

Should Iqaluit become inaccessible from air for the Feb. 5-6 meeting, the conference will be switched to Ottawa, officials said.