Since the crisis affects everyone, China should also help, Lagarde says in Beijing
During official visit to Beijing, the IMF chief warns the crisis could lead to a “lost decade”. For this reason, rich nations must help weak ones since the crisis is global, not continental in origin.
Beijing (AsiaNews/Agencies) – Europe’s economic and financial crises could lead to a “lost decade”. Rich nations must help weak ones since the crisis is global, not continental in origin. The warning came this morning from Christine Lagarde, head of the International Monetary Fund, who is in Beijing on a two-day visit.
Speaking before an economic forum, she said that European plans to bolster a rescue package were a “step” in the right direction, but that the outlook for the world economy remained dangerous and uncertain. “There are dark clouds gathering” on the horizon, she lamented.
The former French Finance minister urged her hosts to work with others. “Our sense is that if we do not act boldly and if we do not act together, the economy around the world runs the risk of downward spiral of uncertainty, financial instability and potential collapse of global demand”.
Lagarde hopes to convince Chinese leaders to help the European Financial Stability Fund (EFSF). However, there is scepticism in China, where public opinion thinks it is a waste of time and money.
Thus, the hopes expressed by the IMF chief are not likely to materialise. Chinese policy makers have said in fact that European plans are “not complete and not firm”, according to a commentary on China’s official Xinhua news agency.
Without political will nothing can be done. “Like a patient, if several organs are in trouble, taking drugs or surgeries will produce toxic side effects and will largely reduce the desired effectiveness,” Xinhua said.