UNITED STATES: BRITISH CHANCELLOR GORDON BROWN SAY'S G-7 COUNTRIES ARE NOW GIVING STRONG AND DECISIVE LEADERSHIP AT TIME OF GLOBAL ECONOMIC TURMOIL

Record ID: 337558

  • Title: UNITED STATES: BRITISH CHANCELLOR GORDON BROWN SAY'S G-7 COUNTRIES ARE NOW GIVING STRONG AND DECISIVE LEADERSHIP AT TIME OF GLOBAL ECONOMIC TURMOIL
  • Date: 3rd October 1998
  • Summary: WASHINGTON, D.C., UNITED STATES (OCTOBER 3, 1998) (RTV - ACCESS ALL) 1. SV UK CHANCELLOR GORDON BROWN SAYING WHAT THE WORLD COMMUNITY WAS LOOKING FOR WAS STRONG, UNITED, DECISIVE LEADERSHIP, AND THAT THE G7 NOW HAS A JOINT PLAN OF ACTION (ENGLISH)/ BROWN TALKING ABOUT THE EUROPEAN REACTION TO THE GLOBAL CRISIS AND THAT GERMAN CENTRAL BANK CHIEF HANS TIETMEYER
  • Embargoed: 18th October 1998 13:00
  • Keywords:
  • Location: WASHINGTON, UNITED STATES
  • City:
  • Country: USA
  • Reuters ID: LVA3EM8SU28ZJXK8S5O90V2H0CET
  • Story Text: British Chancellor of the Exchequer Gordon Brown has said the Group of Seven (G7) leading industrial countries are now giving "strong, united and decisive" leadership at a time of global economic turmoil.

    Shortly after the meeting on Saturday (October 3) Brown said his proposal for a new global financial watchdog to boost the world's ability to predict and prevent global economic crises has met with broad approval.

    Brown, who as current chair of the G7 organised a joint statement in mid-September on the risks facing the world economy, told Reuters that the countries involved were now "turning words into action." "We now have an agenda which shows that we appreciate the scale of the challenges we face but also offers practical solutions that have not hitherto been adopted by the respective countries," he said.

    The G7 consists of Britain, Canada, France, Germany, Italy, Japan and the United States.

    Brown, whose formal title is British Chancellor of the Exchequer, was speaking after a meeting of G7 finance ministers and central bank chiefs taking place on the eve of the annual conference of the International Monetary Fund and World Bank.

    The financial leaders released a communique in which they vowed to work together to promote growth and stability but said little in the way of concrete policy announcements.

    Brown said the meeting had looked at how the different continents of the world could make their contributions to ensuring that the global economy did not dive into recession.

    "All of us are intensifying our efforts to achieve the coordination that is necessary in trade, in reforming the financial system and in dealing with the problems of poverty that are hitting Asia and Africa," he said.

    The "Eurozone" -- the 11 countries that will launch the European single currency next year -- had to make its contribution to world growth by ensuring it cut unemployment from its current high levels.

    Japan, he said, had to take swift, effective action to kick-start its moribund economy, and public money had to be spent to sort out the country's troubled financial sector and put the economy back on the path to growth.

    Brown said his proposal for a new global financial watchdog consisting of the IMF, World Bank, Basle-based Bank for International Settlements and other institutions had met with a "great deal of support." He said German central bank chief Hans Tietmeyer had been asked by the meeting to make a rapid study of the proposal in a bid to take it forward.

    The current global financial structure was originally designed at a landmark conference in Bretton Woods in 1944 but has been found badly wanting in the face of the contagion spreading like wildfire through emerging markets.

    The communique urged the United States, Britain and Canada to take steps to maintain conditions for growth.

    Brown said the Bank of England -- now responsible for setting interest rates in Britain -- was well aware of the problems facing the global economy and had made it clear that the "balance of risks" in the world economy has shifted.

    "But it is up to it to make its decisions on interest rates," he said.He made no reference to coordinated interest rate cuts by the G7 to boost world growth in the wake of cuts by the United States and Canada earlier this week.

    The Bank's Monetary Policy Committee meets next Wednesday and Thursday for its monthly rate-setting meeting and speculation about a cut is heating up.

    Brown added he would be urging the IMF to accelerate and simplify its so-called Highly Indebted Poor Countries (HIPC) initiative.

    He said he was concerned that the global economic storms could derail efforts to write off the debts of the world's poorest nations.
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