Finance ministers and central bankers from the Group of 20 top economies are gathering in Mexico City with Europe hoping that China, Japan and others will soon commit to giving the International Monetary Fund more money so it can help euro zone countries which suffer a cash crunch.

But many G20 countries are insisting that Europe needs to take the first step by bolstering its own bailout funds.

"I expect no decision at the G20 summit on boosting the IMF's resources," said Jens Weidmann, head of Germany's central bank and a European Central Bank (ECB) Governing Council member.

The host of the weekend's meetings, Mexico's finance minister, Jose Antonio Meade, said it was "still early in the process" to discuss specific amounts and ways that G20 nations could commit more money.

The world's rich countries have used the G20 to coordinate their response to the financial crisis that erupted in 2008 after the collapse of the U.S. housing bubble and then spread to Europe where many countries are saddled with heavy debts.

As the crisis has dragged on, however, divisions over how to tackle it have deepened. The IMF wants to raise as much as $600 billion in extra resources to help deal with fallout from the euro zone debt crisis, but the plan faces resistance from countries including the United States and Canada.

The United States has told Europe to do more on its own and also made clear it will not provide more cash to help the IMF handle the crisis.

"What we don't want to see is the IMF substitute -- and it really cannot substitute -- for a stronger European response,"

U.S. Treasury Secretary Timothy Geithner told CNBC television.

Even if it wanted to, President Barack Obama's administration would have little or no chance of getting Congress' approval in an election year to send more cash to help out Europe.

U.S. reluctance has put the onus on Europe's richest countries plus China, Japan and others to raise the funds.

EU leaders will meet next week to discuss boosting their own bailout funds. Even G20 countries that are willing to help are unlikely to promise more money until Europe proves it is acting to help itself.

"The problems many countries are facing today have a solution if they act decisively and in time," said Mexico's central bank governor Agustin Carstens. "If this is done sooner rather than later we will see a promising future for the global economy."

Despite the stand-off over timing, there was broad agreement within the G20 about the need to increase eventually the IMF's firepower and that would likely be reflected in a communique at the end of the weekend's meetings, diplomats said.

GERMANY HITS BACK

Germany has come under pressure with critics saying it could

do more to help its struggling European partners and that its insistence on fiscal belt-tightening risks plunging Greece even deeper into crisis.

Weidmann hit back on Friday, saying Germany was already financing a "disproportionately large share" of rescue efforts to date and that its insistence on budgetary discipline was aimed at ensuring a stable monetary union.

He said there was a popular misconception that Germany had managed to "dodge the flames of the current crisis ... (and) ... is now selfishly refusing to come to the aid of the stricken countries by acting as chief firefighter."

Mark McCormick, a currency strategist at Brown Brothers Harriman in New York, said the long-term answer to Europe's problems would require further progress on a common approach to running national budgets.

"Money from the G20 via the IMF buys them a bit more time," he said.

Some member countries will push the G20 this weekend to at least outline the mechanisms it would use to help.

"Since we might not be able to finalize any numbers, money pledges by individual countries, we should not waste the opportunity to move forward," said Paulo Nogueira Batista, Brazil's representative at the IMF.

The next opportunities for the G20 to agree on more funds for the IMF are most likely to be in April, at the twice-yearly Fund meetings, or in June, when G20 leaders meet in Mexico.

While policy makers squabbled over whether and how to boost the IMF's firepower, a group of international bankers joined calls for the G20 to work harder to boost growth, warning that the euro zone crisis threatens to hit the global economy.

Governments should also take a slower approach on tough new financial rules, the Institute of International Finance said on the eve of the G20 meeting here.

The IIF welcomed the progress Europe has made in addressing its sovereign debt problems through an emergency bailout fund, central bank liquidity, and toughened fiscal rules. But it cautioned that budget cutbacks in weaker countries like Greece and Spain could severely damage long-term growth prospects.

"While necessary, fiscal austerity will in the short term weigh on already sub-par growth," it said. "Mitigating the impact of fiscal austerity is key."

(Additional reporting by Stella Dawson and G20 reporting team; editing by Kieran Murray and William Schomberg)

• A Permanent Economic Emergency