Lagarde leads calls for more aid for Europe
Updated: 2011-11-11 07:37
By Li Xiang (China Daily)
International Monetary Fund (IMF) chief Christine Lagarde delivers her speech at an International Finance Forum in Beijing on Wednesday. The IMF has called for cooperation among nations to improve the current global economic situation. AFP Photo / Liu Jin
BEIJING - The International Monetary Fund (IMF) called on Thursday for cooperation among nations to improve the current global economic situation, and encouraged the larger emerging markets to play a role to produce a resolution to the eurozone crisis.
"The global economic situation can only be improved if there is an appropriate level of cooperation between nations," said Christine Lagarde, managing director of the IMF, at a press briefing in Beijing.
She said that action is necessary from the advanced economies, but added that larger emerging markets can also play a role by participating in discussions to tackle the eurozone crisis.
The IMF head is visiting China amid mounting concern over the European sovereign debt crisis, and as troubled nations, such as Italy and Greece, grapple with domestic politics and struggle to solve their own fiscal meltdowns.
Lagarde stressed that Europe needs "political clarity" and that would be conducive to stability amid the ongoing uncertainty about who will succeed Italy's outgoing Prime Minister Silvio Berlusconi, which has caused volatility in global financial markets.
With European nations looking for investment from cash-rich emerging countries, China, Brazil and Russia have all indicated a willingness to participate in strengthening the role of the IMF and improving the global economic situation.
Commenting on the fund's relationship with China, Lagarde said the IMF has had constant and deep dialogue with the authorities, but declined to comment on whether China will contribute to the fund to help resolve the crisis in the eurozone.
Chinese leaders have been wary of contributing to any kind of European rescue fund, appearing fully aware of domestic public opinion that is firmly set against bailing out Europe with Chinese wealth.
Analysts said that China should wait for the European countries to produce a concrete and workable rescue plan before investing in any fund.
"Helping Europe is in China's long-term interests because it is our biggest trading partner. The concern for the government is that it does not want to squander its wealth and be seen as a source of silly money," said Li Daokui, an adviser to the monetary policy committee of the People's Bank of China (PBOC).
During her first visit to China as IMF chief, Lagarde held discussions with Premier Wen Jiabao, Vice-Premier Wang Qishan and the Governor of the PBOC, Zhou Xiaochuan.
"The Chinese authorities are clearly concerned about what is happening in the eurozone," Lagarde said, adding that she has also held discussions with Beijing about the future of the European Financial Stability Facility, Europe's special rescue fund.
The IMF head also opened an account on Weibo, China's Twitter-like micro-blogging site, to gain a wider audience through the Internet.
With regard to the Chinese economy, Lagarde said it has been heading in the right direction and suggested that Asian countries may loosen their monetary tightening policies at some stage in the future as inflationary pressures ease.
Lagarde also said that Chinese officials are prepared to let the yuan appreciate further in the months and years ahead, a stance that the IMF welcomes.