Flaherty urges European leaders to make hard choices

The world has seen some progress by European leaders on the global debt crisis, Finance Minister Jim Flaherty said Thursday, urging them to make hard choices.

"If Europe is prepared to act as they need to, I am hopeful that the meeting will be able to focus on what all G20 countries will do to support strong, sustainable and balanced growth over the medium-term horizon," Flaherty said, ahead of his departure for Paristo meet withG20 finance ministers and central bank governors.

"The decisions Europe must make are not easy, but governments are elected to make difficult choices."

Flaherty has spent weeks pressuring his European colleagues to move faster on shoring up defences against a global recession.

He says he wants to see credible, medium-term plans in countries with large fiscal deficits to start cutting their debt.

There has been some progress made sincethe last meeting with his counterparts in Washingtonlast month, he allowed.

"Weve seen the French and German leaders announce that they will have a plan by a certain date. That is progress. I look forward to seeing the contents of the plan," Flaherty said.

'Understand frustration'

Flaherty says he's meeting with his Chinese counterpart Friday to talk about China's exchange rate.

"Emerging market economies have an essential role to play in rebalancing global demand. We need those with fixed exchange rates to put in place measures to allow their exchange rates to appreciate," he said.

Flaherty says he's still opposed to a financial transaction tax, which would charge a small fee on every transaction to build up a reserve fund, an idea some leaders were pushing in advance of last year's G20 meeting in Toronto.

He says he can see a point in the Occupy Wall Street protests, adding he understandsthe frustration coming out of a lack of opportunity.

"A very, very small group of people have very large incomes, and others do not have those same opportunities, so it's incumbent on governments, I think, to ensure that there are opportunities for people to exercise their talents so they can participate and be successful in the marketplace," Flaherty said.