The Chinese central bank’s signals over the yuan, the US dollar, and the IMF’s SDR as a super-sovereign currency have stirred up some confusion over its intentions, but top Chinese leaders continue to repeat the need to establish a diversified international monetary system.
In April, when Hu Jintao attended the G20 meeting in London, the whole world was just acknowledging its descent into the financial crisis and economic recession. Now, the crisis has spread but the picture is perhaps a bit clearer.
Italy’s Prime Minister Silvio Berlusconi, who is hosting the G8 meeting, stated last month hopes that the meeting would help to stabilize the financial market rules. Italy is suggesting adopting strict financial market rules to avoid future crises that had received some approval at the G8 treasurers�meeting earlier. Other important topics for the G8 meeting include climate change, Doha trade negotiations, commercial freedom, and grain safety.
But the G8 alone can’t solve the global financial crisis, and the G20 would perhaps be a better mechanism. The July 9 meeting is regarded as preparatory for a G20 summit in Pittsburgh, and the rest of the world will be watching for and examining signals. Â
Along with the G8, other countries invited to the meeting include China, India, Brazil, South Africa, Mexico, Australia, Indonesia, South Korea, Egypt, Holland, Spain, and Turkey.
All the attendees will have their own plans and attitudes to express at the meeting, although no substantial result is expected.
Russian President Medvedev has steadily appealed for a diversified international financial system, while Suresh Tendulkar, head of the advisory council to the prime minister of India, said on July 3 that he was urging his government to diversify its forex reserve and cut dollar assets. Marcelo Baumbach, spokesman for President Lula Da Silva of Brazil, said on July 3 that the president would ask developed countries to be more flexible towards developing countries in terms of dealing with the global economic crisis and climate change.
China’s interests lie in many areas. It hopes to promote the Doha negotiation, and especially establish closer trade ties with Europe.
Along with Hu’s visit to Europe, a delegation of nearly 300 entrepreneurs, led by Vice-Minister of Commerce Gao Hucheng, will visit Italy, Sweden, Finland, and Portugal for trade and investment talks.
Before the delegation set out, a Ministry of Commerce (MoC) official said that some small and medium-sizes enterprises, which seldom see opportunities to acquire and invest in Europe, have been included in the delegation. The official also revealed that according to the different industrial profiles of the four countries, the delegation would focus on trade and investment projects in textile machines, space technology, environment, and new energy in Italy, marble materials, coke, and agricultural products in Portugal, telecoms equipment, automobiles, pulp, and solar batteries in Sweden, and cell phone equipment and paper making machines in Finland.
A special group for investment cooperation will be established so enterprises will be able to talk on this topic.
This is the fourth Chinese trade and investment delegation to Europe after Premier Wen’s visit at the beginning of the year. The EU is now Chin’s largest trading partner and technology exporter, as well as China’s fourth largest investor. Meanwhile, China is the EU’s second largest trade partner.
Since the beginning of the year, the proportion the EU occupies in China’s foreign trade total has increased. According to the latest MoC statistics, in the first five months of 2009, China-EU trade reached $129.26 billion, accounting for 16.9% of China’s total, up from 16.6% in 2008.