Economic officials from the world's major developed and
developing nations gathered Saturday, starting to discuss the
future of global cooperation.
Addressing the opening ceremony of the G-20 Finance Ministers
and Central Bank Governors Meeting in Beijing, Chinese President Hu Jintao
called for strengthening global cooperation to promote common
development.
"On the one hand, peace and development remain the theme of our
times. Economic globalization is going to greater depth," he
said.
"At an amazing speed, modern science and technology have been
making continuous progress that is marked by the advancement of
information technology and bio-technology. And international
industrial transfer as well as the flow of production factors have
accelerated. All this offers countries in the world rare
opportunities for development," Hu said.
On the other hand, however, the global problem of uneven
development is increasingly salient as the gap between the North
and South is further widening. There are financial turbulences from
time to time and new manifestations of trade barriers and
protectionism, the Chinese leader said.
"Facing all this, we must strengthen international cooperation
to seize opportunities and meet challenges together so as to
promote balanced and orderly development of the world economy."
Hu's remarks were echoed by the International Monetary Fund
(IMF) Managing Director Rodrigo de Rato. "Despite the broadly
satisfactory prospects for the global economy, there are risks to
growth stemming from higher oil prices," he said.
Oil producers can begin to increase investment in new
facilities, while oil-consuming countries need to start increasing
refining capacity and to take measures to curb oil demand, such as
improving conservation and energy efficiency, he said.
Rato pointed out that a second major risk comes from global
imbalances. He said the symptoms of these are high current account
deficits and rapidly increasing debt in the United States, and
corresponding surpluses in Japan, China, and many other Asian
emerging market economies, and increasingly oil-producing
countries, including Russia as well as countries of the Middle
East.
These imbalances pose serious risks to prosperity, because they
are clearly unsustainable, and if they are corrected in a
disorderly way, through an abrupt decline in the US dollar and rise
in US interest rates, growth and prosperity all over the world will
be threatened, he said.
China's currency remains a hot topic. "We welcome the change in
China's exchange rate arrangement announced in July as an important
move toward greater exchange rate flexibility," the IMF said in a
statement.
It said that greater flexibility is in China's best interest as
it will provide more room for monetary independence and help to
insulate the economy from shocks. "We encourage China to fully
utilize the flexibility afforded by the new arrangement."
But Chinese Premier Wen
Jiabao has reiterated that the reform of the renminbi exchange
rate mechanism should be "gradual". He told Rato that to gradually
establish a managed, floating exchange rate system based on market
supply and demand and to keep the yuan basically stable at a
reasonable and balanced level is the "unalterable direction" and
goal of China's exchange rate reform.
Finance Minister Jin
Renqing put it in a more direct way, saying that the yuan
appreciation would not remove economic imbalances of the world,
especially of certain nations, and that China will not follow the
"orders" of others to conduct the exchange rate reform.
"We will only discuss issues that China hopes to discuss," he
said.
Some developed countries, typically the United States, contend
that the yuan was undervalued by as much as 40 percent, giving
Chinese exporters an "unfair" advantage. They contend that the
recent 2 percent rise in the yuan's value is too small.
Participants of the G-20 meeting plan to exchange views on the
"problem of ageing and immigration" and "conceptual innovation of
development" Sunday. The meeting is to end at noon Sunday after a
joint communiqué is released.
Established in 1999, the G-20 Group includes major industrial
nations and emerging market countries that account for over 90
percent of the world 's combined gross domestic product (GDP) and
80 percent of global trade.
(Xinhua News Agency October 16, 2005)