US must do more to head off global recession, Yang says
By Feng Jianmin |
August 6, 2011, Saturday
|
Print Edition
Print Edition
CHINESE Foreign Minister Yang Jiechi yesterday called for more global cooperation and greater responsibility from the United States to prevent the world's economy falling into recession, after stock markets tumbled around the globe.
It is the second time in a week that China has urged the US government to adopt "responsible" monetary policies and protect investors' investment in dollar assets.
"We hope the US will keep in mind the world's economic recovery and stability, and adopt responsible monetary policies. As an important trading partner of the US, we hope the US will implement its policies and measures successfully," Yang said in an interview posted on the website of the Ministry of Foreign Affairs.
On Wednesday, China's central bank Governor Zhou Xiaochuan called on the US government to act responsibly to deal with its debt issues, saying uncertainty in the US treasuries market would undermine the international monetary system and hamper global growth.
Yang's comment came after stock market turmoil spread from the West to Asian markets on fears that Europe's debt crisis could spin out of control and that the US economy may slide into another recession.
Yang said a worsening sovereign debt crisis in Europe, possible US defaults, turmoil in the Middle East and the earthquake in Japan are combining to challenge the world economy, and nations should cooperate to sustain economic growth.
"All countries should strengthen communication and cooperation to improve the financial structure of the world. We should object to protectionism in all forms, and crave for powerful, sustainable and balanced economic growth," he said.
Yang also pledged support for the eurozone and the euro, amid suggestions that China, the US's largest foreign creditor, should diversify its foreign reserves after the US debt decision in order to hedge its risks.
China held nearly US$1.16 trillion in US treasuries at the end of May, according to the State Administration of Foreign Exchange, accounting for more than a third of China's US$3.2 trillion in foreign exchange reserves. China sold US$300 million of US debt in the first five months of this year, according to data from the currency regulator.
Yang said: "As a responsible investor in the global financial markets, China has always had confidence in the eurozone and the euro. We have increased buying a considerable amount of European debt in the past few years, and we will continue to support the eurozone and the euro in the future."
Yu Yongding, a former central bank adviser and a professor at the Chinese Academy of Social Sciences, wrote in the Financial Times this week: "China must stop policies that result in further accumulation of foreign exchange reserves. The People's Bank of China must stop buying US dollars and allow the yuan exchange rate to be decided by market forces."
It is the second time in a week that China has urged the US government to adopt "responsible" monetary policies and protect investors' investment in dollar assets.
"We hope the US will keep in mind the world's economic recovery and stability, and adopt responsible monetary policies. As an important trading partner of the US, we hope the US will implement its policies and measures successfully," Yang said in an interview posted on the website of the Ministry of Foreign Affairs.
On Wednesday, China's central bank Governor Zhou Xiaochuan called on the US government to act responsibly to deal with its debt issues, saying uncertainty in the US treasuries market would undermine the international monetary system and hamper global growth.
Yang's comment came after stock market turmoil spread from the West to Asian markets on fears that Europe's debt crisis could spin out of control and that the US economy may slide into another recession.
Yang said a worsening sovereign debt crisis in Europe, possible US defaults, turmoil in the Middle East and the earthquake in Japan are combining to challenge the world economy, and nations should cooperate to sustain economic growth.
"All countries should strengthen communication and cooperation to improve the financial structure of the world. We should object to protectionism in all forms, and crave for powerful, sustainable and balanced economic growth," he said.
Yang also pledged support for the eurozone and the euro, amid suggestions that China, the US's largest foreign creditor, should diversify its foreign reserves after the US debt decision in order to hedge its risks.
China held nearly US$1.16 trillion in US treasuries at the end of May, according to the State Administration of Foreign Exchange, accounting for more than a third of China's US$3.2 trillion in foreign exchange reserves. China sold US$300 million of US debt in the first five months of this year, according to data from the currency regulator.
Yang said: "As a responsible investor in the global financial markets, China has always had confidence in the eurozone and the euro. We have increased buying a considerable amount of European debt in the past few years, and we will continue to support the eurozone and the euro in the future."
Yu Yongding, a former central bank adviser and a professor at the Chinese Academy of Social Sciences, wrote in the Financial Times this week: "China must stop policies that result in further accumulation of foreign exchange reserves. The People's Bank of China must stop buying US dollars and allow the yuan exchange rate to be decided by market forces."
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