The world economy needs to balance austerity with growth if it is to recover properly from the global financial crisis, a key IMF committee said in Tokyo on Saturday.
"Fiscal policy should be appropriately calibrated to be as growth-friendly as possible," the International Monetary and Financial Committee said in a communique.
The statement came after days of back and forth between those -- led by Germany -- urging no let-up from belt-tightening and those arguing for a loosening of the grip of austerity.
International Monetary Fund Managing Director Christine Lagarde said on Thursday she was happy for Greece -- struggling under the weight of cuts demanded by international creditors -- to have two more years to meet its deficit reduction targets.
But on Friday Germany's finance minister Wolfgang Schaeuble said there was "no alternative" to cutting bloated national balance sheets.