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China Daily Website

Debt crisis expected to be raised at G20

Updated: 2012-06-14 03:23
By Zhang Yunbi ( China Daily)

Beijing on Wednesday said it is up to G20 members whether the upcoming summit should discuss the Greek debt crisis.

The two-day G20 summit in Los Cabos, Mexico, scheduled from June 18 to 19, will raise its curtain amid the looming eurozone sovereignty debt crisis, as Moody's Investor Service downgraded the ratings of two Cyprus banks on Tuesday, citing the increased risk of Greece's exit from the eurozone.

President Hu Jintao will attend the summit in Mexico in the wake of his state visit to Denmark from Thursday to Saturday, and global attention has also focused on whether China will support the G20 discussing the Greek debt crisis and Greece's possible exit from the eurozone.

The G20 is a major international platform focusing on urgent risks and challenges in the financial field, and it is "natural and expected" for the upcoming summit to pay attention to the euro debt issue, Foreign Ministry spokesman Liu Weimin said at a news conference on Wednesday.

"If the situation worsens to the degree that it impacts the stability of the global economy and finance, the international community should give it the necessary attention and help," Liu said.

The EU has said it has the determination, capacity and resources to resolve the debt issues, and the upcoming summit should show the G20's confidence in Europe's economic and financial stability, Liu added.

Beijing believes the summit should be based on the big picture of ensuring global economic stability and restoration, and the summit is expected to encourage and support relevant measures taken by countries in the eurozone.

Analysts said the deteriorating debt issue is not simply a matter of money and cannot be wiped out overnight only with financial aid from those outside the eurozone, including China.

"The European Union has also realized the flawed mechanism behind the crisis and the social and economic imbalance among eurozone members. Europe's current priority is to rebuild a common pursuit for rules and discipline," said Wu Baiyi, a researcher with the Chinese Academy of Social Sciences.

As Greece heads for a momentous electoral battle on Sunday that could determine its place in the eurozone, both the conservative New Democracy Party and the leftist Syriza Party said they want Greece to remain in the single currency, AFP said.

In a commentary in the Financial Times on Wednesday, Syriza's leader Alexis Tsipras said his party was "committed to keeping Greece in the eurozone" and warned that the current line of austerity could "force us out of the euro with even greater certainty".

Greeks pulled their cash out of the banks and stocked up with food ahead of the cliffhanger election on Sunday that many fear will result in the country being forced out of the euro, Reuters reported.

Bankers said up to 800 million euros ($1 billion) were leaving major banks daily.