Rich may agree on plan to boost emerging marts
Rich may agree on plan to boost emerging marts
WASHINGTON (Reuter): Rich nations and their up-and-coming
counterparts in the developing world are putting the finishing
touches on a plan to lessen the risk of financial turbulence in
emerging markets, U.S. officials said on Friday.
"We are moving toward consensus on a strategy to strengthen
emerging market financial systems," U.S. Treasury Secretary
Robert Rubin told reporters.
"This is critically important to reduce the risks of future
financial crises."
The strategy includes agreement on a set of core guidelines
and principles as well as specific recommendations for
international financial institutions and regulators on how to
help emerging market economies implement them, he said.
The plan, which was worked out by industrial nations and
emerging market economies and which is expected to be unveiled
next week, covers both the banking and securities fields.
The guidelines will not be mandatory, but may be used by the
International Monetary Fund and World Bank in structuring their
loan programs for some developing countries.
Morris Goldstein, of the Institute for International Economics
think tank, said that three-fourths of the world's economies have
been hit by banking crises over the past 15 years.
Developing nations alone have spent almost $250 billion
bailing out their banks, he said.
Banking regulators worldwide agreed earlier this month on the
basic principles of supervision to strengthen global financial
stability.
The 25 core principles unveiled by the Basle Committee on
Banking Supervision represented the first truly global effort by
bank supervisors to create a worldwide standard.
The report to be released next week will be broader than that
and will cover securities regulation and other legal issues as
well as banking.
It was drawn up by representatives from eight industrial
countries -- the United States, Japan, Germany, France, Italy,
Britain, the Netherlands and Sweden -- and seven emerging markets
-- Argentina, Hong Kong, Indonesia, South Korea, Mexico, Poland
and Thailand.
Rubin said that finance ministers and central bank chiefs from
leading industrial nations will discuss the strategy when they
gather on Sunday on the fringes of the IMF/World Bank semi-annual
meeting here.