G20 leaders left their meetings in South Korea and Japan without a concrete deal on currency exchange rates, but the issue could take months or years to settle, says former prime minister Paul Martin.

The theme of clashing monetary policies was raised at last week's G20 meeting in Seoul, and again at this weekend's summit of the 21-nation Asia-Pacific Economic Cooperation (APEC) group in the Japanese port city of Yokohama.

Leaders announced Sunday they will avoid increasing barriers to trade and cut back on protectionist policies implemented during the economic crisis in an effort to stimulate economic growth. But they offered no timeline for when a regional free trade zone may be established or when they will uniformly allow for the free movement of exchange rates.

Martin, who helped establish the G20 organization, said overall the leaders "did very well in Korea," particularly on issues such as reforming the International Monetary Fund and focusing efforts on economic development.

But in an interview with CTV's Question Period on Sunday, Martin said leaders were "never going to solve the question of global imbalances at this particular meeting."

"You're dealing with profound structural differences between the United States and China, and in fact between Germany and the rest of the Euro zone," Martin said.

"So I think that expectations were somewhat created that really were never going to be lived up to. But I think in fact they are going to succeed, but it's going to take months, if not years, to deal with this fundamentally."

After the APEC meeting wrapped up Sunday, Japanese Prime Minister Naoto Kan gave the year 2020 as a tentative target for establishing a free-trade zone among Pacific nations.

"We reaffirm our unwavering commitment to achieving free and open trade and investment in the region," the leaders said in their final declaration. "We must take steps to build a foundation for stronger, more sustainable and more balanced growth in the future."

Martin said free trade with Asian countries with growing middle classes that are hungry for North American goods will be important, particularly during a fragile recovery from a global recession.

"I think that these are going to be huge markets and we simply cannot turn our back on them," Martin said. "And in fact, as the American market takes its time coming back, our ability to penetrate these growing markets in the East are very important to us."

The APEC leaders' declaration also reiterated the need to reduce government debt amid the global economic downturn, and leaders also pledged to avoid a full-blown currency war.

Undervalued yuan?

The U.S. and other nations have long contended that China intentionally undervalues its currency, the yuan, which gives Chinese exporters an advantage in overseas markets. Meanwhile, several nations have criticized the U.S. for its decision to print more money to stimulate its faltering economy, which they say has hiked the values of their own currencies and spurred inflation.

China did agree to allow its currency to appreciate, but said that it will happen very slowly over a long period of time. The U.S. also agreed to reduce its deficit, which will also take an unknown period of time.

Martin said China's practice of keeping its currency undervalued is a "very, very serious problem." But on the other hand, its efforts to hike the yuan's value will not happen overnight, he said.

"So what you really have to do is everybody has to be aware of the problem, and they've got to realize that this competitive devaluation that they're talking about is another form of protectionism, and they've said very clearly they know the dangers that lie there," Martin said.

At the conclusion of the weekend APEC summit, Prime Minister Stephen Harper said it failed to produce the "bold" moves he had called for ahead of the meeting.

"The necessity of dealing with medium-term questions of global imbalances and exchange rates -- those do have to be tackled over time," Harper told reporters.

"They don't have to be tackled this month or next month in order to avert any kind of cataclysm."

"It's not a problem we can solve in one meeting," Harper also said.

Chinese President Hu Jintao echoed concerns of other world leaders when he said the economic recovery "is not solid," and is threatened by trade imbalances.

"The employment situation in developed countries is grim, and emerging markets face inflationary pressures and asset price bubbles," he told the other leaders.

Such a large free-trade zone, which would reduce tariffs on products ranging from auto parts to food, would encompass half of global economic production and two-fifths of world trade. Reducing trade barriers gives nations easier access to markets for their products and also makes it easier to invest abroad. While free trade can create jobs, it can also threaten them.

Leaders will continue their discussions when the U.S. hosts the next APEC summit in Honolulu, Hawaii in 2011, while leaders will venture to Vladivostok, Russia in 2012.

With files from The Associated Press and The Canadian Press