Hu signals China role in fighting crisis
Reuters
First Posted 10:41:00 11/22/2008
Filed Under: world financial crisis
LIMA -- Chinese President Hu Jintao spelled out on Friday a potentially ambitious role for his country in staving off a deep global recession as he and US President George W. Bush prepared for a weekend summit of leaders from Asia and the Americas.
Hu and Bush, whose presidency is in its last weeks, discussed trade and other issues on Friday night in Peru's capital, before the Asia-Pacific Economic Coordination forum of 21 leaders representing more than half of global output.
The leaders at the APEC summit were expected to ratify previous commitments by the Group of 20 powerful world economies to use trade and government spending to combat the economic crisis. Nine members of APEC are also in the G20.
In a speech to business leaders in Lima, Hu said the global financial situation remained extremely grim and that China was striving to stimulate its economy and would strengthen ties with other developing countries to confront the crisis.
"China will take a responsible attitude and work alongside the international community to strengthen cooperation to strive to protect the stability of international financial markets," Hu said.
"China is within the scope of its abilities taking major efforts to address the financial crisis," including, he said, "providing the necessary support for liquidity" for domestic financial institutions and coordinating macroeconomic policy with other countries.
The leaders of Japan, Indonesia, Australia, Canada, Mexico and Russia and other countries will join Bush and Hu at the summit on the weekend. Many of them arrived earlier in Peru to speak to business executives on Thursday and Friday.
"We face hard times ahead, but we still have a choice: Hope or despair, opportunity or failure. I trust that we will make the right choice," Indonesian President Susilo Bambang Yudhoyono said in his speech, urging business leaders to roll up their sleeves and work through the crisis.
Australian Prime Minister Kevin Rudd warned of a vicious cycle of declining world confidence inhibiting household spending, which could lead businesses to cut investment.
Looking to China
With so many troubled economies looking to China and its mounting foreign exchange reserves to ease their financial hardships, Beijing has been wary of assuming a starring role in negotiations to shore up the international financial system.
China has been a major driver of the world economy as its rapid expansion fueled demand for raw materials such as minerals and grains.
But in his speech, Hu sought to seize some of the initiative and promised China would be active in helping reform international financial institutions.
Earlier, business executives from the region called for economic stimulus packages to offset the global financial crisis.
The executives also urged governments to resist protectionism and excessive regulation as a response to the economic woes.
"The required actions should include fiscal responses to strengthen demand through appropriate spending on public works and tax incentives," Juan Francisco Raffo, president of the ABAC business council that advises APEC leaders, said ahead of the summit.
The APEC trade group accounts for more than 40 percent of the world's population.
APEC has often been criticized as irrelevant because it has never achieved a regional free-trade agreement, but its members have created a web of bilateral commercial pacts binding countries on both sides of the Pacific.
Alert for attacks
As Bush arrived in Lima, hundreds of protesters demonstrated peacefully against US foreign policy and the controversial Guantanamo prison camp run by the United States in Cuba.
Later, police arrested and held for questioning a woman who was carrying a knife near the hotel where Bush is staying and where he met with Hu.
Days before Bush's last visit to Peru, in 2002, leftist guerrillas killed 10 people when they exploded a car bomb near the US Embassy in the capital.
Thousands of police have patrolled Lima all week to prevent similar actions by insurgents, who recently carried out attacks in Peru's Andes.
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