G20 summit to leave out additional funding for EU bailout

Xinhua, October 29, 2011

Chinese minister: G20 summit not to consider additional funding for eurozone bailout

Chinese Vice Finance Minister Zhu Guangyao said here Friday the coming G20 summit will not discuss whether its members would capitalize the eurozone bail-out package known as the European Financial Stability Fund (EFSF).

He said the leaders will not discuss buying European bonds at the summit either.

"This is not on the agenda of the summit," Zhu told a press briefing about Chinese President Hu Jintao's attendance of the G20 summit in Cannes next week.

Zhu said since the eurozone had put off coming up with detailed plans for the EFSF's operation until the end of November or early December, this G20 summit will not discuss the issue of injecting funds into the EFSF.

The Cannes summit will instead focus on the core subjects of promoting global growth and maintaining stability in the global market. It will discuss such topics as reforms of the global currency system, financial supervision, controlling price fluctuation of bulk commodities and development issues.

The European Union and eurozone leaders agreed at a summit Thursday to write off part of Greece's debts, expand the bloc's financial rescue fund to 1 trillion euros and to recapitalize European banks. But the meeting failed to decide on how to carry out the plan and left the question to the meeting of EU and eurozone financial ministers, which will be held in early November.

Zhu said China had already contributed funding to the EFSF.

Zhu's comments echoed the response of world leaders after the EU summit passed a package to alleviate the European sovereign debt crisis.

In a telephone call with his French counterpart, Nicolas Sarkozy, Thursday, Hu Jintao voiced hope that the series of measures would help Europe stabilize its financial markets, overcome current difficulties and promote economic recovery and growth.

President Hu also expressed the hope that the individual parties involved in the G20 Cannes summit would adopt common measures to ensure world economic growth.

"So the key now is to make sure that there is strong follow-up, strong execution of the plans that have been put forward, but I was very pleased to see that the leaders of Europe recognize that it is both in Europe's interest and the world's interest that the situation is stabilized," U.S. President Barack Obama said on Thursday.

"The Chinese side hopes that the design of EFSF policy tools would be professional and operable," Zhu said, adding that this constitutes an important aspect of the fund's efficiency.