Former US treasury secretary Henry Paulson said on Tuesday he was wrongly portrayed in a Financial Times article as claiming China is to blame for the global economic crisis.
Former US Treasury Secretary Henry Paulson, seen here on Jan 12, 2009, speaks at the Resources for the Future Center in Washington, DC. [Agencies]
"In the years leading up to the crisis, super-abundant savings from fast-growing emerging nations such as China and oil exporters - at a time of low inflation and booming trade and capital flows - put downward pressure on yields and risk spread everywhere," the British newspaper quoted Paulson as saying on Jan 2.
That, the newspaper quoted him as saying, pushed down interest rates and drove investors to riskier assets, sowing the seeds of a global credit bubble that extended beyond the US subprime or high-risk home loan market and eventually burst.
"The FT reporting was wrong," Paulson said in a statement sent to the Xinhua News Agency. "In assessing the financial market crisis, I have repeatedly and consistently targeted the vast majority of my criticism at problems in the United States, particularly our flawed and outdated regulatory structure."
"Whenever I have commented on global imbalances, it has been against that backdrop and I have gone out of my way to say that no single country is to blame for the imbalances," he added.
Paulson also gave an example - a speech he made Nov 12 - in which he said: "Over a period of years, persistent and growing global imbalances fueled a dramatic increase in capital flows, low interest rates, excessive risk taking and a global search for return."
"Those excesses cannot be attributed to any single nation," he said.
In his statement to Xinhua, Paulson said: "The US-China relationship continues to be vital to both our nations and to the global economy."
"To maintain a strong and mutually beneficial relationship, we must rely on direct communication rather than media reports," he said.