Group of Twenty (G20) summit in Seoul gradually approaches, differences in national trade policies and the war of words has become increasingly fierce. According to “Japanese Economic News” reported on November 9, Japanese Finance Minister Ye Tian Jiayan criticized the United States, set the current account surplus on the gross domestic product (GDP) 4% of the recommendations, but also against the proposed South Korean President Lee Myung-bak in the next few months to achieve reduction of export-dependent countries of current account surplus “target” proposal. The German Chancellor Angela Merkel on November 8 also pointed out that the so-called current account surplus goal “too narrow”, he said trade protectionism is the biggest threat facing the global economy.

Japan and then split, “Objectives of surplus”

Benefited from strong export growth and income month income growth, Japan’s September current account surplus of 1.9598 trillion yen, up by 24.3%; of which exports to 5.5474 trillion yen, representing an increase of 761.1 billion yen. This shows that Japan’s foreign trade is still the country’s economic recovery is the main force, so clearly does not support the country’s current account surplus of goal setting.

Ye Tian Jiayan at a regular press conference after the cabinet meeting, said, “When we refer to (current account surplus) specific target figures, and whether the issue will be finalized G20 summit in Seoul, we must keep in mind that situation faced by each country is different. “He added,” more likely, the leaders of the Member States may agree to amend the global imbalances to develop guidance approach, but they may not achieve the specific details, is that the financial sector by the States to finalize the charge. ”

Earlier, U.S. Treasury Secretary Timothy Geithner Gyeongju in South Korea G20 meeting of finance ministers and central bank governors proposed to the countries current account deficits or surpluses limited to less than 4% of their GDP, while the finger appears to be mainly aimed at China’s largest the amount of trade surplus. While hosts South Korea to support this proposal, several South Korean President Lee Myung-bak also expressed the hope that leaders of the G20 member countries to the summit in Seoul, signed on the specific objectives of current agreements, export-oriented countries in order to reduce current account surplus.

However, the meeting in Gyeongju, countries and current account surpluses failed to provide clear quantitative targets, the proposal elicited the opposite Geithner developed economies of Japan and Germany firmly opposed, while Japan and Germany both have large current-account surplus .

Germany, the threat of protectionism warning

Protectionism is the current global economic recovery, the biggest threat facing the countries have not yet taken sufficient measures to ensure genuine free trade. G20 should make every effort to promote the World Trade Organization (WTO) Doha Round negotiations concluded as soon as possible.

G20 finance ministers earlier in the United States and Central Bank Governors meeting on the set trade target of the proposed current-account surplus, Merkel reiterated that the proposal “too narrow”, “International trade is not just the exchange rate is more important to be is to improve the competitiveness of enterprises in a country. “In addition, members of Merkel also establish non-tariff barriers to trade G20’s expressed concern about the latest moves, including the United States Congress attempted to pass legislation” attempts to increase market access difficult. ”

However, Merkel criticized the United States trade policy, the achievements of the G20 is still defended, saying the success of the organization to avoid the current global economic crisis into a long-term economic downturn.

South Korea wavering stance

As “surplus target of” the proponent of Geithner’s attitude in recent days seems to swing.

June 6, Geithner said in Tokyo, the current account deficit or surplus is not to set limits or targets. India in two days, Geithner stressed, G20 member states need to sign the “guiding principles” intended to affirm the trade imbalance will lead to economic risks. But he did not make short-term, rigid quantitative targets.

In addition, senior adviser to South Korean President International Economics 8, Shin Hyun Song, said in an interview, G20 member states need to avoid setting the first current account surplus or deficit on the target. He said, “just a simple current target figure is misleading, but also undesirable.” However, said Shin Hyun Song, Seoul, in the summit, the participating States may be “guiding principles” into the question and finalize the principles and the implementation timetable.

In this regard, CITIC Securities chief economist Hu Yifan macroeconomic analysis, said that countries will shift their attention from the foreign exchange management is the settlement of international current account imbalances, a new trend. However, to achieve a set goal of current proportion of GDP, is not easy, because the income and expenditure account structure depends on many factors, including levels of development, the country’s economic structure and to take fiscal and monetary measures.

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