Egypt's PM, JICA chief discuss boosting investment, education ties at TICAD 9    Egyptian pound wavers vs. USD in early trade    SCZONE showcases investment opportunities to eight Japanese companies    Egypt urges Israel to accept Gaza deal amid intensifying fighting    Egypt, ADIB explore strategic partnership in digital healthcare, investment    Egypt's PM meets Tokyo governor, witnesses signing of education agreements    Egypt welcomes international efforts for peace in Ukraine    Al-Sisi, Macron reaffirm strategic partnership, coordinate on Gaza crisis    Egypt's Sisi, France's Macron discuss Gaza ceasefire efforts in phone call    Contact Reports Strong 1H-2025 on Financing, Insurance Gains    Egypt, India's BDR Group in talks to establish biologics, cancer drug facility    AUC graduates first cohort of film industry business certificate    Egypt to tighten waste rules, cut rice straw fees to curb pollution    Egypt recovers collection of ancient artefacts from Netherlands    Egypt harvests 315,000 cubic metres of rainwater in Sinai as part of flash flood protection measures    Egypt, Namibia explore closer pharmaceutical cooperation    Fitch Ratings: ASEAN Islamic finance set to surpass $1t by 2026-end    Renowned Egyptian novelist Sonallah Ibrahim dies at 88    Al-Sisi says any party thinking Egypt will neglect water rights is 'completely mistaken'    Egyptian, Ugandan Presidents open business forum to boost trade    Egypt's Sisi, Uganda's Museveni discuss boosting ties    Egypt's Sisi warns against unilateral Nile measures, reaffirms Egypt's water security stance    Egypt, Huawei explore healthcare digital transformation cooperation    Egypt's Sisi, Sudan's Idris discuss strategic ties, stability    Egypt to inaugurate Grand Egyptian Museum on 1 November    Egypt's Sisi: Egypt is gateway for aid to Gaza, not displacement    Greco-Roman rock-cut tombs unearthed in Egypt's Aswan    Egypt reveals heritage e-training portal    Sisi launches new support initiative for families of war, terrorism victims    Egypt expands e-ticketing to 110 heritage sites, adds self-service kiosks at Saqqara    Palm Hills Squash Open debuts with 48 international stars, $250,000 prize pool    On Sport to broadcast Pan Arab Golf Championship for Juniors and Ladies in Egypt    Golf Festival in Cairo to mark Arab Golf Federation's 50th anniversary    Germany among EU's priciest labour markets – official data    Paris Olympic gold '24 medals hit record value    A minute of silence for Egyptian sports    Russia says it's in sync with US, China, Pakistan on Taliban    It's a bit frustrating to draw at home: Real Madrid keeper after Villarreal game    Shoukry reviews with Guterres Egypt's efforts to achieve SDGs, promote human rights    Sudan says countries must cooperate on vaccines    Johnson & Johnson: Second shot boosts antibodies and protection against COVID-19    Egypt to tax bloggers, YouTubers    Egypt's FM asserts importance of stability in Libya, holding elections as scheduled    We mustn't lose touch: Muller after Bayern win in Bundesliga    Egypt records 36 new deaths from Covid-19, highest since mid June    Egypt sells $3 bln US-dollar dominated eurobonds    Gamal Hanafy's ceramic exhibition at Gezira Arts Centre is a must go    Italian Institute Director Davide Scalmani presents activities of the Cairo Institute for ITALIANA.IT platform    







Thank you for reporting!
This image will be automatically disabled when it gets reported by several people.



Finance ministers cannot solve currency dispute

WASHINGTON: Differences over currency management persisted after a weekend meeting of global finance ministers who left without resolving what to do.
They did agree, however, that the 187-nation International Monetary Fund was the organization best suited to deal with rising global currency tensions that risk overshadowing next month's summit meeting of the Group of 20 nations in South Korea.
The G-20 includes traditional economic powers such as the United States and Europe along with fast-growing economies such as China, Brazil and India.
Various nations are seeking to devalue their currencies as a way to increase exports and jobs during hard economic times. The concern is that such efforts could trigger a repeat of the trade wars that contributed to the Great Depression of the 1930s as country after country raises protectionist barriers to imported goods.
French Finance Minister Christine Lagarde said Saturday that a successful resolution of the currency dispute with China would require a cooling of overheated rhetoric about currency wars.
"In a war, there is always a loser and in this situation there must not be a loser," she said.
Canadian Finance Minister Jim Flaherty said, "Currency disputes can easily become trade disputes."
The International Monetary Fund ended two days of talks with a communique that pledged to "deepen its work" in the area of currency movements. This included giving the head of the IMF, Dominique Strauss-Kahn a mandate to operate as judge, arbiter and analyst in dealing with the main players in the currency dispute, The United States, the euro area, China and Japan.
The communique essentially papered over sharp differences on currency policies between China and the United States.
The Obama administration, facing November elections where high US unemployment will be a top issue, has been pressing China to move more quickly to allow its currency to rise in value against the dollar.
American manufacturers contend the Chinese yuan is undervalued by as much as 40 percent and this has cost millions of US manufacturing jobs by making Chinese goods cheaper in the United States and US products more expensive in China.
China has allowed its currency, the yuan, to rise in value by about 2.3 percent since announcing in June that it would introduce a more flexible exchange rate. Most of that increase has come in recent weeks after the Obama administration began taking a more hardline approach and the US House passed tough legislation to impose economic sanctions on countries found to be manipulating their currencies.
Chinese officials continued to insist that their gradual efforts to revalue their currency was the best approach to take.
"China will move the exchange rate gradually," Zhou Xiaochuan, head of China's central bank, said during a panel discussion Friday. "We will do it in a gradual way rather than shock therapy."
Chinese officials say that allowing the currency to rise too rapidly would cost thousands of manufacturing jobs and destabilize the Chinese economy.
China is hardly alone in trying to gain a competitive advantage. The United States is contributing to a weaker dollar by pressuring Beijing and by the Federal Reserve flooding the markets with US dollars.
The Japanese government intervened in currency markets for the first time in years on Sept. 15. It sold yen and bought dollars to push the yen's value lower. And this week, the Japanese central bank announced that it would pursue a policy similar to the Fed's: buy assets to lower Japanese interest rates, another way to lower the yen's value.
Brazil and South Korea have also taken recent actions to weaken their currencies as a way to protect their exporters.
Egyptian Finance Minister Youssef Boutros-Ghali told reporters Saturday at a concluding IMF news conference that there were "a number of points of friction" at the meetings. But he said it was a significant achievement that all countries recognized the central role the IMF should play in trying to resolve currency conflicts.
Strauss-Kahn said he did not view the outcome of the discussions as a failure. He said they set the stage for further progress at the upcoming summit of leaders of the Group of 20 nations in November in Seoul and at future IMF meetings.
Strauss-Kahn said the G-20 countries remained committed to the goals they established a year ago of achieving more balanced global growth and that this will require changes in currency policies.
"I am not disappointed," Strauss-Kahn told reporters about the outcome of the two days of talks. "We can talk and talk and talk. What we need is real action. I don't believe this action can be done except in a cooperative way."
Strauss-Kahn acknowledged that significant differences also remained on the question of reforming the IMF by giving China and other fast-growing economic powers greater voting rights and representation on the IMF board. The G-20 leaders are supposed to endorse a deal on IMF reform at their Nov. 11-12 summit.
Treasury Secretary Timothy Geithner on Wednesday raised the possibility that awarding greater power to China in the IMF should be linked to a greater willingness of that country to reform its currency system.
Strauss-Kahn told reporters Saturday that this comment was not a form of blackmail but rather acknowledgment that as countries grow more important economically, they must bear greater responsibility for the proper functioning of the global economy.
But Oxfam, an international aid group, criticized Geithner's effort to link currency reform and expanded voting rights for developing countries.
"The currency war cannot be used to hold IMF reform hostage," said Oxfam spokeswoman Pamela Gomez. "The IMF can't do its job unless emerging economies are at the table."


Clic here to read the story from its source.