PRC urged to play wider role in solving crisis


Fri, Oct 24, 2008 - Page 1

The EU yesterday called for more say for Beijing in international financial bodies but said China in return had to play its part in helping to resolve the global economic crisis.

The comments by European Commission President Jose Manuel Barroso set the stage for a two-day summit in Beijing of the 27 EU member states and 16 Asian nations covering the global downturn, climate change and international security.

“We need a coordinated global response to reform the global financial system. We are living in unprecedented times, and we need unprecedented levels of global coordination,” Barroso said.

“It’s very simple: we sink together or we swim together,” he told reporters.

While outlining no specific proposals, the former Portuguese prime minister said a solution needed to be based on principles of transparency, responsibility, cross-border supervision and global governance.

US President George W. Bush has invited the Group of 20 nations, which includes major industrial states and big emerging economies such as China, India and Brazil, to meet in the US on Nov. 15 to discuss global financial reforms.

Diplomats said the commission, the EU’s executive arm, and France, which currently holds the EU’s rotating presidency, hope to win a commitment from China in particular to use its clout to help shape the reforms and tackle the economic imbalances at the root of the current meltdown.

“I very much hope that China gives an important contribution to the solution of this financial crisis,” Barroso said. “I think it’s a great opportunity for China to show a sense of responsibility.”

Later, Barroso dangled the carrot of greater influence for Beijing on the world financial stage.

China this year won a modest increase in its voting power at the IMF but argues that it is still not being allowed to punch its weight as the world’s fourth-largest economy and the one that is growing fastest.

“We think China could and should have a greater voice in international financial institutions,” Barroso said in a speech at a school for civil servants.

The purpose of the biennial Asia-Europe Meeting (ASEM), launched 12 years ago, is to narrow the diplomatic distance between two continents accounting for 60 percent of global output and two-thirds of world trade.

Barroso was not alone in urging closer cooperation between the two blocs.

German Chancellor Angela Merkel said after meeting Chinese Premier Wen Jiabao (溫家寶) that working together was the key to overcoming the financial crisis, the deepest in more than 70 years.

Among a spate of other meetings on the sidelines of ASEM, Southeast Asian leaders were due later yesterday to discuss a Thai proposal to develop an emergency financial fund for the region.

Thailand also wants countries around Asia to pool part of their vast holdings of foreign exchange reserves to facilitate trade, investment and tourism in the region.

South Korea, Japan and China — which will meet the leaders of ASEAN today — were likely to endorse the urgency of beefing up an existing web of central bank credit lines totalling US$80 billion by the first half of next year, envoys said.

But they said the three North Asian neighbors, which have the biggest holdings of currency reserves in Asia, were opposed to putting part of their currency hoards into a common pot.