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Politics : Foreign Affairs Discussion Group -- Ignore unavailable to you. Want to Upgrade?

To: Hawkmoon who wrote (160850)	4/22/2005 10:31:18 AM
From: teevee	Read Replies (1) \| Respond to of 281500

Care to be more specific? Sorry for not providing more detail. I was referring to Bush's policy leadership to other countries. Although it is to be expected that other countries put their own economic interests first, there is a diference between doing this in a co operative manner (agreements on trade, currencies etc and with policies which conform and honor those agreements etc) and in a way that undermines other nations. I believe the deficit that many people at home and abroad are complaining about is a cost the world has to bear, as the US is incurring this deficit to fight terrorism and rogue nations around the world for all nations' benefit. IMF winds up with warning tvnz.co.nz IMF winds up with warning Related Articles G7 seeks vigorous steps Apr 18, 2005 A weekend of high-powered finance meetings wound in Washington on Monday with an ominous warning from the head of the IMF on chances of a market shock and no deal on debt relief. Senior finance officials from around the world, representing the Group of Seven industrialised states and the policymaking body of the IMF, also made clear their worries about the impact of high oil prices and appealed again for currency market stability. The meetings were scheduled to conclude later in the day with a statement from the Development Committee, which sets policy for the World Bank. International Monetary Fund Managing Director Rodrigo Rato, speaking late Sunday, dampened optimism evident in an earlier G7 statement with a warning that markets could suffer "an abrupt correction" unless major powers took steps to even out the pace of growth. He said the global financial system was now out of kilter because of the huge US current account deficit, weak growth in Europe and Japan, the low savings rate of US consumers and inflexible currency regimes in Asia. "If policies do not adapt, do not change to react to these imbalances, we run the risk of an abrupt correction of the markets ... (when) confidence for different reasons could evaporate or could be reduced," he told reporters. But both Rato and the G7 - Britain, Canada, France, Germany, Italy, Japan and the United States - forecast continued healthy global growth this year, albeit threatened by rising energy costs. The Group of Seven and IMF policymakers were also in agreement on the need to promote energy efficiency and diversity, with the Fund calling specifically for "removing barriers to the development of alternative fuels." "We believe there should be a closer dialogue that brings together exporters and importers," said British finance minister Gordon Brown, chairman of the IMF's International Monetary and Financial Committee. "We believe that the level of information about available resources and transparency in relation to that ought to be far greater so that the world and markets are in a better position to know what the true position is." Despite any sign of concrete headway, G7 ministers nonetheless claimed progress toward their goal of erasing an $107 billion multilateral debt burden that sees more money go on interest repayments than on health or education in the developing world. "It's now recognised, I think for the first time from these meetings, that more money has to be made available," Brown said. "What we must now do is get the international agreement on sums of money and we believe that that will come at Gleneagles," he said in reference to a Group of Eight - the G7 plus Russia - summit in Scotland in July. The G7 ministers made no mention of a Brown-inspired proposal under which the IMF would sell a portion of its massive gold reserves to cancel the debt owed it by poor countries. The IMF says such a sale is technically feasible but the United States fears that offloading the reserves, which at current rates are worth $60 billion, would destabilise the markets. "We are not persuaded by arguments for IMF debt relief, and we do not believe that market or 'off-market' gold sales are necessary or warranted," Snow said. Addressing the Development Committee today, Snow said "the international community needs to go further by providing up to 100% debt stock relief" for the world's poorest countries that owe money to the World Bank and the African Development Fund. "These actions ... will put these poor countries on a sustainable path immediately." But Japanese Finance Minister Sadakazu Tanigaki warned that "uniform 100% debt relief of multilateral development bank debts" could encourage imprudent borrowing "and may reduce the debt well beyond the need to ensure debt sustainability." Group of Seven ministers in addition made another veiled attempt to induce China to allow its dollar-pegged yuan to float, repeating their previously stated position that "more flexibility in exchange rates is desirable for major countries or economic areas that lack such flexibility". But China was not expected to ease its resistance to abandoning the dollar peg, which according to US and European officials undervalues the yuan and gives Chinese exports an unfair advantage.