10-24-2008, 11:29 AM
<b>China Urged to Fight Crisis By Asia, Europe Leaders</b><!--QuoteBegin-->QUOTE<!--QuoteEBegin-->China is seen as key to any global response because it has the world's fastest-growing major economy and <b>$1.9 trillion of currency reserves</b>, an amount larger than Canada's gross domestic product. <!--QuoteEnd--><!--QuoteEEnd--><!--QuoteBegin-->QUOTE<!--QuoteEBegin--><b>Emerging Power' </b>
China already seemed to supplant Japan as the region's financial leader on Oct. 8, when it reduced its interest rate within minutes of cuts by the U.S. Federal Reserve and five other central banks. The Bank of Japan, with the lowest benchmark rate of any major economy at 0.5 percent, supported the move in a statement without participating in it.
Since then, Asian countries have either included Chinese leaders in their proposals on limiting the credit crunch's spread or made them the centerpiece. Thailand's request that China ease conversion restrictions on its currency is aimed at facilitating the pooling of reserves to create a $350 billion fund to protect the region's currencies and buy stocks and bonds, said Thailand's Deputy Prime Minister, Olarn Chaipravat, in an interview in Bangkok on Oct. 22.
``The message of this initiative is for China to consider whether or not China would open up its banking system and allow the strongest currency in the world, which is the Chinese yuan, relative to anybody, to be the rightful and anointed convertible currency of the world,'' he said.
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This will be trap for China.
China already seemed to supplant Japan as the region's financial leader on Oct. 8, when it reduced its interest rate within minutes of cuts by the U.S. Federal Reserve and five other central banks. The Bank of Japan, with the lowest benchmark rate of any major economy at 0.5 percent, supported the move in a statement without participating in it.
Since then, Asian countries have either included Chinese leaders in their proposals on limiting the credit crunch's spread or made them the centerpiece. Thailand's request that China ease conversion restrictions on its currency is aimed at facilitating the pooling of reserves to create a $350 billion fund to protect the region's currencies and buy stocks and bonds, said Thailand's Deputy Prime Minister, Olarn Chaipravat, in an interview in Bangkok on Oct. 22.
``The message of this initiative is for China to consider whether or not China would open up its banking system and allow the strongest currency in the world, which is the Chinese yuan, relative to anybody, to be the rightful and anointed convertible currency of the world,'' he said.
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This will be trap for China.