EC’s Barroso Says Crisis Needs Heightened Coordination

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The current financial crisis will require unprecedented levels of global coordination to resolve it because no country is immune to its effects, European Commission President Jose Manuel Barroso said on Thursday.

Speaking in Beijing a day before the opening of the Asia-Europe Meeting (ASEM), Barroso said that apart from dealing with financial problems, leaders would need to address major imbalances in the global economy that he said were at the root of the crisis.

“We need a coordinated global response to reform the global financial system. We are living in unprecedented times, and we need unprecedented levels of global coordination,” Barroso told reporters. “It’s very simple: We sink together or we swim together.”

The ASEM meeting on Friday and Saturday, which brings together leaders of more than 40 Asian and European countries, is set to discuss the financial crisis, sending a reassuring sign of unity to world markets without taking any concrete action.

Barroso has said he would use the meeting to urge major Asian economies such as China and India to join in taking responsibility for stabilizing the world economy.

“We need a coordinated response globally — that will be my main message to Asian leaders,” he said, noting that challenges included problems in the monetary system and imbalances in global foreign exchange reserves.

The G20, which includes major industrial nations and big emerging economies such as China, India and Brazil, will meet in the United States on Nov. 15 to discuss financial reforms.

Barroso said he was satisfied with the emergency actions taken in recent weeks in Europe to recapitalize banks and stabilize the financial system, but he added that world leaders now had to address more fundamental issues of global governance in order to design a better architecture for the world economy.

“Our analysis confirms that apart from the financial dimension of this crisis, there are major imbalances in the world economy that need to be addressed by world leaders,” Barroso said.

(Reporting by Simon Rabinovitch; Writing by Jason Subler; Editing by Ken Wills)