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Asian, European Leaders to Discuss Financial Crisis, Environment

  • Daniel Schearf

Asian and European leaders are arriving in Beijing to discuss ways to deal with the global financial crisis. Europe wants support from China and other Asian giants on the crisis, as well as on climate change and sustainable development. Daniel Schearf reports from Beijing.

Leaders from more than 40 Asian and European countries will hold two days of talks in the Chinese capital.

The seventh Asia-Europe Meeting, known as ASEM, begins Friday and will focus on shoring up global confidence in the face of a world economic slowdown.

European leaders want to see more support from fast-growing China and India.

The president of the European Commission, Jose Manuel Barroso, told journalists no country is immune to the crisis. He says the international financial system needs sweeping reforms and that for them to work, Asia needed to be "on board."

"We are living in unprecedented times and we need unprecedented levels of global coordination. It is very simple. We swim together or we sink together," he said.

During the past few months, governments around the world have moved to shore up banks, make cash available to lenders and to stabilize markets. The credit crisis, sparked originally by the collapse of bad loans in the United States property market, has resulted in several large international banks being forced to close or merge.

Barroso says the financial crisis is not the only cause of the global economic slowdown.

He says major imbalances and problems with monetary policies were other causes.

"If you look, for instance, at the level of reserves some countries have and the level of consumption, or internal demand, compared with other major players. That is one of the reasons why I really believe that China has a word to say and that is, by the way, in the interest of China, to be an active participant in this new financial order that will be created," Barroso said.

China has nearly $2 trillion in foreign currency reserves and has been under pressure to allow its own currency to appreciate. Other governments also hope Beijing can stimulate domestic consumption, to reduce the damage from slowing demand in Europe, Japan and the United States.

Chinese leaders say they are paying close attention to the global crisis and are considering what measures are needed to maintain stability.

The meeting of Asian and European leaders is an opportunity to discuss common concerns, and will not produce binding agreements.

During the meeting, leaders will also discuss climate change. Europe wants advanced developing countries like China to make more substantial commitments to reduce greenhouse gas emissions.

Barroso says he hopes the world does not make the same mistake with climate change as they did with the financial crisis. He says when they see a serious problem coming nations should not postpone the solutions.

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