IIIarionov suggests China can learn from Russia on currency reform
Beijing. (Interfax-China) - China and Russia, two powers with historical tensions which have gone in different economic and political directions in recent years, have several lessons to learn from each other, said Andrei IIIarionov, Adviser to the President of Russia and the President's Personal Representative to the G-8, on the China Business Summit 2003 Interfax attended in Beijing on November 6.
IIIarionov listed several lessons on which China and Russia can learn from each other. The first is that extremely rapid economic development is attainable - the "mission is possible," said IIIarionov. A second lesson is that any political and social development necessarily follows economic growth. Only once wealth has been created can it be distributed properly. One aspect of the Chinese example which IIIarionov hopes Russia would follow is China's "courageous approach" in allowing private entrepreneurs to take controlling interests in infrastructure projects, such as road construction.
Pasi Rutanen, senior advisor of M-Real Corporation, Finland, remarked that the two countries cooperate officially on a number of fronts, from energy to banking, and he envisioned a gradual strengthening of this cooperation. One recent development highlighted by Rutanen was the six-party talks on North Korean nuclear policy, in which both China and Russia played key roles.
Serge Berthier, chairman of Asian Affairs, Hong Kong SAR, also commented on Sino-Russian cooperation. He argued that there is "unprecedented" potential for mutual cooperation in economics and in combating terrorism. Berthier said Russia and China will be pushed still closer together.
IIIarionov also advised that China might learn from Russia how to proceed with currency liberalization. He predicted that conversion from a fixed to a floating exchange rage would prove profitable for China. As to the same issue, Zhou Wenzhong, vice-minister of Foreign Affairs, was adamant that China would set its own exchange rate policy, in another panel discussion on US-China relations on November 7. Zhou argued that China's currency peg is in line with China's economic conditions and beneficial to both Asian and global stability. Yet he admitted the possibility that China might eventually move to a market-based exchange-rate regime with its economic development continuing apace.
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