China hopes G20 to focus on global recovery

08-Nov-2010

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By Kevin Yao

LISBON (Reuters) – China hopes this week’s G20 summit in Seoul will help promote recovery in the global economy and deepen reforms of the world’s financial systems, Chinese Commerce Minister Chen Deming said on Sunday.

“We hope the G20 can play a big role in promoting global monetary reforms and governance, and help the global economy to have strong, sustainable and balanced growth,” Chen told Reuters during President Hu Jintao’s state visit to Portugal.

China’s trade surplus in 2011 “will be manageable” as the country’s foreign trade still faces global uncertainties, Chen said.

“I believe China’s foreign trade will continue to grow next year but the growth will not be very strong,” he added.

Chinese trade officials have forecast the trade surplus in 2010 could fall to $180 billion from $196 billion in 2009.

Concerns over global trade imbalances, largely China’s huge trade surpluses with Western nations, and the threat of “currency war” will top the agenda at the meeting of G20 leaders on November 11-12.

G20 countries will try to resolve at least some of their differences over how best to reduce the imbalances that are destabilizing the world economy.

China has been trying to fend off foreign pressures on its currency policy, arguing that the country has taken measures to boost its imports to help reduce the trade surplus.

During President Hu Jintao’s recent visit to France, China signed of around $20 billion worth of airline, petrochemicals and nuclear fuel deals, including contracts to buy 102 Airbus (Paris:EAD.PANews) planes.

Chen said on Friday that Beijing was not deliberately targeting a trade surplus and would welcome a more balanced relationship, but Europe must play a role by ensuring its own markets were open for Chinese investment.

Hu has given his support to President Nicholas Sarkozy’s initiatives to reform the global financial system, but the pace of changes should be gradual, Vice Foreign Minister Fu Ying told Reuters on Saturday.

France, which takes up the G20 baton after the Seoul summit, wants to build common ground for its ambitious agenda of reforming the global monetary system, while avoiding alienating China by harping on about the yuan.

China has won France’s understanding that the Chinese trade surplus was mainly caused by structural factors rather than the exchange rate, Fu said.

“We have gained common ground on the exchange rate issue. China’s view is that every country should take responsibilities in maintaining stable exchange rates,” she said.

(Reporting by Kevin Yao; Editing by Michael Roddy)

Source: sg.finance.yahoo.com

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