China Calls for Establishing a Fair World Trade SystemA fair foreign trade and world economic system should be established to ensure that all countries benefit equally from globalization, a Chinese central banker said Sunday in Washington."Not only should the liberalization of commodity trade and capital transactions be promoted and pursued, but also the free movement of labor and the transfer of technology," said Xiao Gang, deputy governor of the People's Bank of China and alternate governor of the Fund for China, at a meeting of the International Monetary and Financial Committee of the International Monetary Fund (IMF). Xiao urged the advanced countries to strengthen their macroeconomic coordination, maintain a reasonable stability of exchange rates among the major currencies, increase the transfer of funds and technology to the developing countries, especially to the poorest ones, and open their markets to the latter. On the IMF's role in the global economy, he said the Fund should establish a relatively clear-cut division of labor and responsibility with the World Bank, the Bank of International Settlements (BIS), and other international institutions so that overlapped functions can be avoided and resources better utilized. The World Bank, Xiao said, should focus on economic development and poverty reduction. "Such an arrangement with unambiguously defined mandates and subsequent specialization and cooperation among these institutions will undoubtedly improve their efficiency and allow them to actively play their respective roles." China opposes any attempt to raise the interest rate for IMF facilities and believes that the terms and interest rate of the Fund facilities should not be made a scapegoat for the failure of Fund programs, which largely result from their unrealistic conditionalities, he said. "Currently, most of the poor countries have no access to the international capital markets and emerging economies also have difficulty in accessing the capital markets," Xiao said, adding that IMF arrangements should ensure those members' access to Fund resources and the role of the Fund in resolving its members' balance of payment difficulties and in preventing and rescuing financial crisis-affected economies should not be undermined. Turning to Fund surveillance, Xiao said the IMF should focus its attention on developing standards in its core areas such as macroeconomic policy and balance of payments and improving surveillance on their implementation. |
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