The heads of Europe’s largest economies agreed on Sunday on the need for greater regulation of financial markets and to double IMF funding to avoid a repeat of the global economic crisis.
The leaders of Britain, France, Germany, Italy, Spain and the Netherlands met in Berlin to hammer out a joint European stance for the G20 meeting of developed and developing countries in London on April 2.
They agreed that “all financial markets, products and participants — including hedge funds and other private pools of capital which may pose a systemic risk — must be subjected to appropriate oversight or regulation,” a summary of the meeting said.
The leaders proposed adding an extra US$250 billion, double the current level of funding, to the IMF budget so it can work more effectively to prevent future financial crises.
British Prime Minister Gordon Brown said a reinforced IMF would be able to help central and eastern European countries swept up in a growing economic crisis as western banks withdraw credit.
“We are proposing today ... a US$500 billion IMF fund that enables the IMF not only to deal with crises when they happen but to prevent crises,” Brown told a press conference.
“There is a need for a global New Deal so that the world economy can recover,” he said, referring to the plan to end the 1930s Great Depression.
French President Nicolas Sarkozy said participants in the April summit to be attended by US President Barack Obama “will bear a historical responsibility” and warned that concrete decisions had to be reached by then.
“By April 2, we have to succeed and we cannot accept that anything or anyone gets in the way of that summit ... if we fail there will be no safety net,” Sarkozy said.
German Chancellor Angela Merkel said Europeans were determined that a better-regulated financial system would emerge from the wreckage of the deepest financial crisis since World War II.
“It’s not a case of talking up the situation, but we want to send the message that we have a real opportunity to come out strengthened from this crisis,” she said.
German Foreign Minister Frank-Walter Steinmeier, whose Social Democrats will challenge Merkel’s party in September polls, told the Financial Times that “the turbo-capitalism of the past few years is dead, irrevocably so.”
“We must now create a new order for the future. The conditions for this are auspicious. This shock is deep, not only in continental Europe but in the US and UK,” he said.
But a joint stance on the funds — highly speculative and lightly regulated entities accused of fueling instability in financial markets — represents a shift in the long-held position of countries like Britain.
London had resisted greater regulation of hedge funds, which supporters say benefit the economy in part by bearing risks others are unwilling to take, though Brown called recently for stronger rules.
The results of the meeting on Sunday will be discussed by all 27 EU members at summits next month. But agreement might be hard to find, said Czech Prime Minister Mirek Topolanek, whose country holds the rotating EU presidency.
He said Sunday’s talks had exposed deep rifts.
“If I put it very tenderly, the divergence in opinions was rather big,” Topolanek told reporters on the plane home.
“It was obvious that the four countries representing the EU in the G20 [France, Germany, Britain, Italy] do not have the same opinion on a number of issues,” he said.
“Our responsibility [as holders of the presidency] is to look for some unity. This won’t be easy at all,” he said.
NO HUMAN ERROR: After the incident, the Coast Guard Administration said it would obtain uncrewed aerial vehicles and vessels to boost its detection capacity Authorities would improve border control to prevent unlawful entry into Taiwan’s waters and safeguard national security, the Mainland Affairs Council (MAC) said yesterday after a Chinese man reached the nation’s coast on an inflatable boat, saying he “defected to freedom.” The man was found on a rubber boat when he was about to set foot on Taiwan at the estuary of Houkeng River (後坑溪) near Taiping Borough (太平) in New Taipei City’s Linkou District (林口), authorities said. The Coast Guard Administration’s (CGA) northern branch said it received a report at 6:30am yesterday morning from the New Taipei City Fire Department about a
IN BEIJING’S FAVOR: A China Coast Guard spokesperson said that the Chinese maritime police would continue to carry out law enforcement activities in waters it claims The Philippines withdrew its coast guard vessel from a South China Sea shoal that has recently been at the center of tensions with Beijing. BRP Teresa Magbanua “was compelled to return to port” from Sabina Shoal (Xianbin Shoal, 仙濱暗沙) due to bad weather, depleted supplies and the need to evacuate personnel requiring medical care, the Philippine Coast Guard (PCG) spokesman Jay Tarriela said yesterday in a post on X. The Philippine vessel “will be in tiptop shape to resume her mission” after it has been resupplied and repaired, Philippine Executive Secretary Lucas Bersamin, who heads the nation’s maritime council, said
CHINA POLICY: At the seventh US-EU Dialogue on China, the two sides issued strong support for Taiwan and condemned China’s actions in the South China Sea The US and EU issued a joint statement on Wednesday supporting Taiwan’s international participation, notably omitting the “one China” policy in a departure from previous similar statements, following high-level talks on China and the Indo-Pacific region. The statement also urged China to show restraint in the Taiwan Strait. US Deputy Secretary of State Kurt Campbell and European External Action Service Secretary-General Stefano Sannino cochaired the seventh US-EU Dialogue on China and the sixth US-EU Indo-Pacific Consultations from Monday to Tuesday. Since the Indo-Pacific consultations were launched in 2021, references to the “one China” policy have appeared in every statement apart from the
More than 500 people on Saturday marched in New York in support of Taiwan’s entry to the UN, significantly more people than previous years. The march, coinciding with the ongoing 79th session of the UN General Assembly, comes close on the heels of growing international discourse regarding the meaning of UN Resolution 2758. Resolution 2758, adopted by the UN General Assembly in 1971, recognizes the People’s Republic of China (PRC) as the “only lawful representative of China.” It resulted in the Republic of China (ROC) losing its seat at the UN to the PRC. Taiwan has since been excluded from