Leading article: Not a grand bargain, but a step towards recovery

Nor did the final communiqué address the great global imbalances – the colossal trade surpluses of some countries and the spiralling deficits of others – that helped to bring about the present crisis. No common approach on dealing with the toxic assets still poisoning the global financial system was laid out. In short, this G20 meeting did not produce the "grand bargain" that its chairman, our Prime Minister, had hoped for.

And yet it would be wrong to conclude from the absence of such measures from the communiqué that the London meeting was an abject failure. It was an achievement in itself to get the leaders of these nations – which together account for 90 per cent of world's economic output, 80 per cent of world trade and two-thirds of the global population – together around the same table at a time of such turbulence in the international economy.

Just about every government in the world is seeing its trade slowing, its output contracting and its unemployment rising. The siren voices calling for leaders to enact counter-productive and populist measures are loud. The infrastructure of the G20 successfully brought them together, compelling them to address the crisis as the global blight that it is.

Nor should we underestimate the significance of those measures which were agreed by these leaders. The $500bn (£340bn) recapitalisation of the International Monetary Fund might not be the kind of news story to get pulses racing but it is significant nevertheless as far as stability in the global economy is concerned.

The risk of more emerging nations – many of them in Central and Eastern Europe – needing to draw on these funds is growing. The knowledge that the IMF is not about to run out of lending capacity should help boost confidence. Investors will be less likely to pull their money out of the likes of Estonia and Bulgaria if they know this safety net is there. The $250bn increase in the "special drawing rights" of all IMF members should also help underpin the confidence of those who have invested in developing nations.

There was a fresh commitment from the G20 to avoid protectionism. The sceptical will point to a similar pledge after last November's meeting of the same group which has not exactly been assiduously followed. There have been no naked tariff rises, but there has been a good deal of "soft protectionism", not to mention demands for banks to concentrate on their home markets.

Yet the $250bn over two years that G20 nations pledged in trade credits at least represents a tangible recognition that the global exchange of goods and service is part of the solution, rather than the problem. The new lending from the IMF to the poorest nations is also a sign that the best way for the world to beat this downturn is a return to growth and sustainable development.

There was some significance in the demands for transparency from the world's tax havens too. It has been impossible in the past to secure international agreement on bringing such enclaves into line. Now enough treasuries are concerned about the amount of tax they are missing out on to recognise that plugging such leaks is in their interests. For sure, cleaning up the likes of Liechtenstein and the Cayman Islands will not influence the duration of this downturn. But it might presage a welcome new era of financial co-operation between the world's largest economies.

It is hard to regard the G20 pledge for more regulation of the international financial sector – including the establishment of a global Financial Stability Board – as much more than an exercise in bolting the stable door after the horse has long since escaped. The immediate crisis in the financial world is one of crippling risk aversion and conservatism, rather than reckless exuberance.

Yet if these promised reforms help to bolster the confidence of investors, they might conceivably prove useful in propelling us out of this downturn. People tend to be more likely to invest if they think their money will be safe. And with many investors still smarting from the Madoff scandal, the commitment to greater oversight of hedge funds could help to restore that necessary faith. The response of global stock markets to yesterday's communiqué was certainly encouraging.

The brinkmanship and hyperbole of recent days has, at times, made this week's G20 meeting seem like a "make or break" summit for the global economy. The reality was always rather more subtle and less dramatic. This meeting was a stop on a larger journey, not the final destination. After yesterday's result, there are grounds for hope that we are, at least, on the right road.