European finance chiefs said yesterday the global economic recovery was not yet strong enough for various governments to halt stimulus measures, after meeting Chinese Premier Wen Jiabao (溫家寶).
A delegation led by Eurogroup chief Jean-Claude Juncker, European Central Bank head Jean-Claude Trichet and economic and monetary affairs commissioner Joaquin Almunia also urged a “gradual and orderly” appreciation of the yuan.
It also warned China to be careful with its exports, which are often much cheaper than those of other countries, to avoid provoking a protectionist backlash.
“We are considering the moment has not yet arrived to withdraw the stimulus packages that are under way in various parts of world,” Juncker told a news conference after a meeting between EU officials and Chinese economic managers.
China’s recovery was well under way, Juncker said, adding the euro zone was also detecting clear signs of improvement and expecting to see a moderate recovery next year.
“The euro area will see no major withdrawal of stimulus measures in 2010,” he said.
The yuan currency’s exchange rate is one of the thorniest issues between China and the EU.
“We said there was a case for what I would say is a gradual and orderly appreciation of the currency against the euro and the major floating currencies. This was our message,” Trichet said.
“We were not defending the overall interest of the European economy only,” he said. “We were defending what we trust is the superior interest of both the Chinese and the European economy — and the global economy.”
Trichet said the rebalancing of China’s export-dependent economy was “part of its own stability and prosperity.”
Meanwhile, Wen was scheduled to have dinner last night with European Commission President Jose Manuel Barroso.
Both men will take part in today’s China-EU summit. Global warming is expected to dominate today’s discussions.
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