Currency Reform

G20 heated debate over currency, trade issues

(Xinhua)
Updated: 2010-11-10 14:40

SEOUL - One day ahead of the G20 Seoul Summit, the working-level meetings are still at a stalemate over the thorny currency and trade imbalance issues, the organizing committee said Wednesday.

Related readings:  QE2 may aggravate global economic imbalance  G20 seeks growth through public-private partnership  RMB issue is a US smokescreen for the G20  G20 Biz Summit zooms on public-private co-op

"We are still having a hard time reconciling contrasting views of different countries, especially over the currency and trade imbalance issues," Kim Yoon-kyung, spokesperson of the committee, told reporters at a press briefing.

Ahead of the G20 Summit, vice finance ministers and Sherpa meetings are being held, adding final touches to the agenda and ironing out differences over sensitive issues.

During the preliminary discussion process, critical issues, such as clarifying the indicative guideline on current account surpluses and deficits, are being tabled, Kim said, still not nearing any breakthrough.

The recent quantitative easing (QE2) has also been talked over, but views from the member countries stood in stark contrast to one another, Kim added.

Other issues being discussed by vice finance ministers include financial regulatory reform, which was outlined in the Basel III, and the IMF governance and quota reform, according to the spokesperson.

The two-day summit, fifth in kind, will bring together heads of 20 member states and is ready to push ahead with discussions on major global issues, such ways to refine the Framework for Strong, Sustainable, and Balanced Growth, and to complete crisis-tackling policy measures, such as financial regulatory repair and international financial institution reform.

Media attention has been majorly focused on whether leaders can make a step forward from what has been agreed at the Gyeongju Finance Ministers' Meeting, in particular with regards to the currency disputes.

In late October, finance ministers and central bank governors of the G20 states agreed to maintain capital account surpluses and deficits according to the so-called indicative guideline, without defining its specific form.

While South Korea, as chair, has been stressing it would make substantial achievements in the currency area, presenting a range of options, discussion at the working level seemingly has yet to show much progress, dimming the expectation on the results of the Summit.

The G20 Seoul Summit, after a year-long preparation of the South Korean government, will kick off Thursday.