ID :
125391
Tue, 06/01/2010 - 14:20
Auther :

(G20 meeting) Australia backs G20`s financial regulation tailored to each nation: treasurer

By Koh Byung-joon
SEOUL, June 1 (Yonhap) -- Australia is "committed" to the Group of 20 countries'
efforts to step up financial regulation, but any agreement should reflect each
nation's different domestic circumstances, the top financial policymaker of
Australia said.
The comments by Australian Treasurer Wayne Swan come amid sharply divided
opinions among the G20 members over when and how to introduce a bank levy and
other measures aimed at sharing financial burden in case of another worldwide
financial crisis.
"Australia is committed to moving the G20 agenda forward on financial regulation.
The G20 has a responsibility to make sure our global banking system can stand on
its own two feet in the years ahead," he said in an emailed interview with Yonhap
News Agency ahead of his visit to Korea for a G20 meeting to be held later this
week in the southern port city of Busan.
"But it's also important to remember that the crisis didn't play out the same way
in every country. So while we need to continue our cooperation at the G20, it
will always be the case that countries will need to tailor global agreements to
suit their domestic circumstances," he added.
Countries have failed to produce a consensus on details of the tax scheme, which
generally obliges banks and other institutions accused of causing market
turbulence to pay for the disruption.
The United States and Britain favor taxing banks to recoup taxpayer money spent
on bailing out struggling financial firms. Canada and Australia have opposed the
plan, while South Korea has yet to decide.
In their Washington meeting in April, the International Monetary Fund suggested
two types of solutions.
The first type is aimed at asking for each nation to pay money up front, before
any crisis occurs. The second type is intended to levy taxes on profits and
remuneration paid by financial institutions in a bid to secure money to brace for
yet another worldwide crisis.
Currently, each nation has yet to iron out differences over how to introduce a
bank levy. Some claim that they are not required to introduce such a measure
since their financial sector was not affected by a crisis this time.
"The Australian financial system did not go through the kinds of upheaval seen in
other advanced economies and is not expected to require the same kinds of
adjustments," Swan noted.
With regard to economic conditions, he noted that each nation has shown a
different speed of recovery, requiring exit strategies to be pursued based on
different domestic economic conditions. But he emphasized the importance of
keeping cooperation among the member nations to "enhance consistency and prevent
any cross-border spillovers."
"The multi-speed recovery means that G20 members will not and should not be
implementing exit strategies at the same time. These will vary depending on
national economic conditions," he said. "However, the G20 can cooperate to
enhance consistency and address cross border spillovers."
He assessed the G20's efforts to overcome the global crisis positively, saying
that it has played a "key role" in stabilizing financial markets but stressed
that it has to deliver on commitments it has made if it wants to keep its role in
the international community down the road.
Touching on the latest global economic conditions including the European debt
problems, the treasurer noted that discussion of fiscal consolidation and
structural reforms will be key themes of following G-20 meetings.
"We welcome the recently announced rescue package in response to the Southern
European debt crisis. However, it is important for European countries to develop
credible plans to stabilize and reduce public debt," he said.
"It is also important for Southern European countries to address their
competitiveness challenges. I expect discussion of fiscal consolidation and
structural reform to be key themes of forthcoming G20 meetings," he added.
Meanwhile, on South Korea's role as a chair of G20 meetings this year, he
expected Korea will bring a "welcome focus on the Asia region, highlighting the
region's strong economic growth prospects."
"South Korea is well placed to understand the perspectives of both advanced and
emerging markets and to help forge common positions. We are confident Korea will
continue to provide strong and effective leadership in its host year and beyond,"
he noted.
kokobj@yna.co.kr
(END)

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