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LECCE FRAMEWORK TO BE DEBATED
In preparation for the G8 summit, finance ministers of the eight rich countries met in Lecce, south of Italy, one month ago. They hammered out an agreement on the new push for global financial reform, which would be discussed by G8 leaders this time.
The so-called Lecce Framework includes a set of common principles and standards regarding the conduct of international business and finance.
"We agreed on the need to develop the Lecce Framework which builds on existing initiatives and lays the foundation for a stable growth path over the long term," G8 finance ministers said in a statement then. "We are committed to working with our international partners to make progress with this initiative, with a view to reaching out to broader fora, including the G20 and beyond."
They said for the market economy to generate sustained prosperity, fundamental norms of propriety, integrity and transparency in economic interactions must be respected.
"Reform efforts must address these flaws in international economic and financial systems with resolve. This will require promoting appropriate levels of transparency, strengthening regulatory and supervisory systems, better protecting investors, and strengthening business ethics," the statement said.
The Lecce Framework classified a wide range of instruments into five categories, namely corporate governance, market integrity, financial regulation and supervision, tax cooperation, and transparency of macroeconomic policy and data.
Specific issues covered include, inter alia, executive compensation, regulation of systemically important institutions, credit rating agencies, accounting standards, the cross-border exchange of information, bribery, tax havens, non-cooperative jurisdictions, money laundering and the financing of terrorism, and the quality and dissemination of economic and financial data.
ONE STEP IN A LONG PROCESS
So far, both the United States and the European Union (EU) have adopted an ambitious package to strengthen financial regulation, but differences remain on how far they should go in the international push.
Even within the EU, Germany and France even can not see eye to eye with Britain. While Berlin and Paris strongly support tougher financial regulation, London is simply afraid that its financial power would be undermined.
German Chancellor Angela Merkel warned ahead of the G8 summit that governments would fight off any attempt by banks to water down tough reforms of financial regulations.
"There is perhaps a certain danger that banks which are doing quite well again might try to not exactly support the regulation efforts, but to put them in doubt again," Merkel told the Wall Street Journal Europe in an interview.
She said that bank reforms must not wane although the economy is showing tentative signs of improvement.
Putting the results of the G8 summit into doubt, Italian Prime Minister Silvio Berlusconi played down on Friday any prospect of the summit agreeing new rules for global finance, saying it will be just "one step" in a long process.
"We will need many steps before we arrive at a common rulebook," Berlusconi said. "L'Aquila is one step towards further analysis."
Editor:Guo Changdong Source:Xinhua
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