China Seems To Join Overhaul Call
After several days of talks between European and Asian leaders, China apparently has allied itself with Europe in calling for a vigorous system of international regulation.
In closed-door talks with European leaders Friday and Saturday, senior Chinese officials said they would back Europe's effort to overhaul international regulatory systems, European diplomats present at the meetings said. China most strongly stated its position Friday in a talk between Chinese President Hu Jintao and Jose Manuel Barroso, president of the European Commission.
Mr. Hu, according to diplomats at the meeting, said China would 'actively cooperate' with the EU, which has been pushing an ambitious new system of global oversight. Formal talks on the new reforms would begin in mid-November in Washington.
'The Chinese said they'd back more vigorous reforms,' a senior European diplomat said in an interview. 'They rely on the global economy and are afraid it's become very unstable.'
Chinese officials had no comment on the closed-door meeting. In public statements, Chinese leaders issued milder endorsements of reforms. At the close of the seventh Asia-Europe Meeting on Saturday, for example, Chinese leaders backed the 45 nations' statement, which expressed 'the need to improve the supervision and regulation of all financial actors, particularly their accountability.'
Foreign diplomats have been keen to see how China would come down on the issue of regulation. On one hand, China values stability and thus would seem naturally to support regulation. On the other, it likely doesn't want international institutions that curb its sovereignty or constrain its financial flows.
In Brussels, EU officials said they weren't surprised China agreed to side with the EU in pushing for new rules for financial markets. 'They want a seat at the table in whatever is going to happen,' said an EU official who attended an Oct. 15-16 summit that drafted the EU's plan.
In addition to the summit, EU officials were in Beijing to prepare a coming EU-China dialogue, while senior trade officials were in town to win China's help to conclude the Doha round of trade negotiations.
British Foreign Secretary David Miliband said the meetings showed how economic power is shifting east.
'I don't think it's just the fact that we are meeting in the Great Hall of the People and we listened to the general secretary of the Chinese Communist Party talking about the need to prop up global capital markets that brings home to one that there is this big shift in economic power,' Mr. Miliband said in an interview with the British Broadcasting Corp.
At the Beijing meeting, the Sultan of Brunei, representing the 10-member Association of Southeast Asian Nations, announced a plan to pool $80 billion of foreign-exchange reserves from 13 Asian nations, though the fund probably won't by launched until the middle of next year.
Separately, Zhou Xiaochuan, China's central-bank governor, said that the country's economy is developing as expected but that the world economic slowdown has added uncertainties to its prospects, according to the Xinhua News Agency on Sunday.
He said the central bank will strengthen the supervision system, create advanced emergency programs to deal with possible negative effects on the country's banking system and work to maintain a sufficient credit supply on the domestic market. |
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