US shares “common ground” with EU on financial turmoil

November 9th, 2008 - 11:23 am ICT by IANS  

Washington, Nov 9 (IANS) Heading into this weekend summit of world’s 20 largest industrialised nations and emerging economies, the US says it shares some “common ground” with European Union leaders on how to address the financial turmoil.US President George W. Bush has invited the Group of 20 (G20) leaders including Prime Minister Manmohan Singh for a summit here Nov 15, but his aides have been cautious about the prospects of concrete reforms emerging from the meeting.

The Bush administration shares “common ground” with European leaders about how to respond to the crisis and the need to move ahead on “certain reforms immediately,” the White House said Saturday without going into specifics.

“The United States has long been working to advance a financial markets reform agenda with many other countries,” his press secretary, Dana Perino said, adding that many of those actions are reflected in the EU statement.

The White House statement, however, did not address developing nations’ demand for a more prominent role in a proposed overhaul of the global financial system voiced by the Brazilian president, Luiz Inacio Lula da Silva.

Rich nations like the US and European countries need to let emerging economies help shape a new “financial architecture,” he said at a meeting of G20 finance ministers in Sao Paulo Saturday.

Developing nations - including Brazil, Russia, India and China, the so-called BRIC countries - have long complained they do not have fair representation within the International Monetary Fund (IMF) or the World Bank.

European Union leaders, on the other hand, say they want an early warning system to watch for imbalances in financial markets, make the IMF the world’s financial watchdog, improve supervision of financial players and close loopholes that let some institutions avoid regulation.

They would push for tougher regulation and more power for the IMF at the Washington meeting, the EU leaders said Friday. They also said they would support a second summit within the next 100 days.

The White House has taken a cautious line for the first summit, urging that it focus on identifying the underlying causes of the financial crisis, establish principles for reform and set up working groups to address specific issues.

US President-elect Barack Obama, who has vowed to address the economic crisis head-on once he takes over from Bush on January 20, will not be attending the Nov 15 summit, but the White House has said that he would be kept in the loop.

“As he said himself, there is only one president at a time,” Obama’s transition spokeswoman Stephanie Cutter told reporters after Obama’s first post-election news conference in Chicago Friday.

White House too said it did not expect Obama to join, but “we are in communication and coordination with them.”

“I don’t know whether someone will actually be in the building. I don’t expect in the room,” spokesman Tony Fratto said of Obama’s economic team.

Fratto also pledged close cooperation with the president-elect’s economic advisers on the best way to respond to the global financial meltdown in order to avoid sending “confusing signals” to international markets.

“We look forward to hearing their views on how to deal with these issues which are going to go on for some time,” the spokesman said.

The G20 includes the seven major industrialised nations - Britain, Canada, France, Italy, Japan, Germany and the United States - plus Argentina, Australia, Brazil, China, India, Indonesia, Mexico, Russia, Saudi Arabia, South Africa, South Korea and Turkey.

It also takes in the 27-nation European Union, represented by France, which holds the rotating EU presidency. The International Monetary Fund and World Bank also participate in its meetings.

Related Stories

    Posted in Uncategorized |