Leaders from the Group of 20 (G20) developed and emerging economies are due to meet here on Thursday on the financial crisis and global economy.
The following is a brief introduction to the European Union (EU)'s common position at the event as agreed by bloc members earlier this month.
1. Coordination of fiscal stimulus measures
The EU supports continuous international coordination of fiscal stimulus measures, but it has been resisting a call from the United States to boost its fiscal stimulus package.
The EU said it should be the priority to restore the functioning of credit markets and facilitate the flow of lending to the economy.
2. Better regulation of financial markets
The EU has been pushing hard for a deal to ensure appropriate regulations and oversight of all financial markets, products and participants that may present a systemic risk, such as hedge funds, private equity, alternative investment vehicles, credit rating agencies and tax heavens which have enjoyed light-touch regulation.
Corporate remuneration practices, banks' capital requirement and accounting standards, which contributed to the current crisis, all need to be improved.
International supervisory cooperation should be improved. The EU will in particular call for the rapid establishment of colleges of supervisors for all major cross-border financial institutions before the end of 2009.
3. Reform of international financial institutions
The EU wants to improve surveillance instruments of the International Monetary Fund (IMF) in order to strengthen its key role in crisis prevention, together with the Financial Stability Forum (FSF).
It calls for a very substantial increase, at least doubling, of IMF lending resources so that the fund can help its members which experience balance of payments difficulties in the crisis. EU member states are ready to provide 75 billion euros (99 billion U.S. dollars) to the IMF in the form of a loan.
The 27-nation bloc also supports the reform of the governance of international financial institutions. It agrees to give more saying to emerging economies in the IMF and backs the FSF expansion to all G20 members, Spain and the European Commission.
The EU also hopes to find consensus on a Global Charter for Sustainable Economic Activity as a first step toward a set of global governance standards.
4. No to protectionism and trade finance fund
The EU want G20 members to make a strong commitment to keep their markets open and avoid all forms of protectionist measures.
It called for a swift conclusion of the long-stalled Doha Round of global trade talks and support for a multilateral initiative on trade finance.
British Prime Minister Gordon Brown, the host, has said he will propose to set up a 100-billion-dollar global fund to provide trade finance.
5. Support to developing countries
The EU said the G20 should honor commitments to increase development assistance, meet aid-for-trade pledges and give duty-free and quota free-access to the least developed countries. The 27-nation bloc will work to enable multilateral development banks to help counter the effects of the crisis in developing countries.
Although the EU hopes to speak with one voice at the G20 London summit, there has already been some divergence among its major members.
While Germany and France firmly rejected the U.S. call for further fiscal stimulus and stressed the top priority should be on global financial reform, Britain tends to have certain common ground with Washington.
(Xinhua News Agency March 31, 2009)