Ahead of their semi-annual meetings in Washington this weekend, the IMF and World Bank sought to manage tensions around global currency values. IMF Managing Director Dominique Strauss-Kahn expressed regret at a lack of cooperation between nations strained by an uneven recovery from the financial crisis.Speaking at a news conference in Washington, he said an adjustment in currency values must be part of economic rebalancing.
"Many are talking about a currency war. Myself, I think I use this vocabulary which maybe a bit too military. Military say that many do consider that currency as a weapon and that's certainly not for the good of the global economy, of course."Emerging economies like China have requested a bigger say at the IMF, but Strauss-Kahn said the role comes with greater responsibility in the global economy. In a seperate news conference, World Bank President Robert Zoellick also warned against currency tensions.
"History shows there is no future in beggar-thy-neighbor policies and in an increasingly inter-connected world we need not just to be conscious of the negative effects that policies can have on others, but we need to act accordingly. And today we face currency tensions. Tensions can lead to trouble if not properly managed."During this weekend's meetings of the IMF and Wolrd Bank, as well as a Friday night session of the Group of 7 finance chiefs, intense discussions about efforts to persuade China to let its currency rise are expected.
Sarah Irwin, Reuters.
