Developed nations should take more responsibility in protecting the interests of global investors, while emerging economies ought to have more power in international bodies such as the International Monetary Fund, a Chinese lawmaker and ex-central bank official said on Monday.
Wu Xiaoling, former vice governor of the People’s Bank of China, told a financial conference in Shanghai that the upcoming G20 summit in London in April was unlikely to bear much fruit.
“It’s impossible for any concrete agreements to be reached at the G20. We shouldn’t pin much hope on it,” Wu said, adding: “That’s why we should have our voice heard.”
Brazil, India, Russia and China, collectively known as the BRIC countries, have issued a joint communique ahead of the G20 meeting calling for more lending to emerging economies hit by the collapse of private capital and for urgent reforms to improve their representation in the IMF.
“The IMF should increase the share from emerging economies, and treat all members equally,” Wu said. “A new set of rules should be set up to regulate the world economy, with a focus on global superpowers.”
China has said it will actively help efforts to revive the global economy, as well as reform financial systems and introduce principles for reforming international financial institutions.
Wu also said that countries issuing hard currencies should protect the interest of global investors, rather than that of their own institutions, echoing Premier Wen Jiabao’s concern about the security of China’s assets in the United States.
China is the largest holder of US Treasury bonds, and the volume of the country’s investment in these assets grew by $14.3 billion to $696.2 billion in December. Wu acknowledged that an improvement in the international monetary system and economic imbalance, however, would not happen overnight, so the current economic crisis may last three to five years before the situation recovers.
The G20 groups finance ministers and central bank governors from 20 developed and developing economies including the United States, the United Kingdom, Japan, France, Germany, the European Union and the BRIC countries. (Reuters)