Loading ...The European Union wants the world financial system to be overhauled and this is the mandate the EU and the European Commission will carry with them at the G-20 summit in Washington next week, President Traian Basescu said on November 7 following the closure of an informal European Council meeting.
Basescu said that the importance of the European Union tackling the reform of the world financial architecture is multi-fold, adding that the European Union is openly embracing its leadership vocation in the world economy.
Basescu said that the importance of the European Union tackling the reform of the world financial architecture is multi-fold, adding that the European Union is openly embracing its leadership vocation in the world economy.
“This crisis was probably the moment when the EU could stand out for the measures it has taken and the solutions it has found. The world financial system needs corrections that will take into account both the power acquired by the European Union, and the emerging markets. The world financial system cannot stay frozen in its initial architecture, because of the economic realities in the EU and the economies of countries like China, India and Brazil,” said Basescu.
The Romanian head of state mentioned that the reform of world financial institutions, such as the International Monetary Fund and the World Bank is included among the reform measures discussed.
Basescu reiterated that the current world crisis has two dimensions: a macroeconomic and a regulatory and oversight one. He added that by its size, the financial crisis has become an economic crisis as well.
Basescu reiterated that the current world crisis has two dimensions: a macroeconomic and a regulatory and oversight one. He added that by its size, the financial crisis has become an economic crisis as well.
“It is very clear that the magnitude of the financial crisis has generated the risk of a global economic crisis. It is possible that more crisis outbreaks will become visible in the time immediately ahead,” said Basescu.
He added that, unfortunately, the financial resources of international financial crisis – the IMF and the World Bank – are not enough when other crisis outbreaks emerge. He said the delegations having attended the informal meeting of the European Council concluded that the EU displayed responsibility, unity, solidarity and power to coordinate its actions related to the financial turmoil.
The Romanian head of state also said that the intervention cap of the EU on Friday was raised from 12 billion euros to 25 billion euro and the EU will participate in the Washington summit at three levels aimed at seeking joint guidelines to build a new international financial system – modifying the responsibilities of the existing institutions, modifying the weight of the EU point of view within this system, and an action plan to be urgently implemented.
“A working manner allowing for rapid decisions should also be built,” said Basescu.
He added that the EU intends to advocate four joint action principles to change the architecture of the world financial architecture, adding the responsibility and transparency of all the participants in the financial system are needed, saying that the EU directly aims at management responsibility.
He added that the EU intends to advocate four joint action principles to change the architecture of the world financial architecture, adding the responsibility and transparency of all the participants in the financial system are needed, saying that the EU directly aims at management responsibility.
“Managers cannot be independent and act risky on markets for some years and then get in a crisis and wait for the Government to extend public money to cover the errors generated by excessive risks undertaken in financing,’ said Basescu.
He added that the IMF is expected to play a main part as the authority of the EU within the IMF increases and so does the IMF role as an overseer of global financial stability.
“The IMF will expand its responsibility within this reform process, in which the EU becomes the equal partner of the US,” said Basescu.
He added that the IMF is expected to play a main part as the authority of the EU within the IMF increases and so does the IMF role as an overseer of global financial stability.
“The IMF will expand its responsibility within this reform process, in which the EU becomes the equal partner of the US,” said Basescu.
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