-
Russia Finance Minister Alexey Kudrin (L), NZ Finance Minister Bill English at Apec - Source: Reuters -
Related
Finance Minister Bill English says that although New Zealand is on the road to recovery there is still concern about the US economy and where it is going.
English made the comments as finance ministers from the 21 Asia Pacific Economic Cooperation (Apec) countries met in Singapore, brainstorming strategies to sustain the global economic recovery.
US Treasury Secretary Timothy Geithner says the timing of stimulus exit policies would vary between countries, but business confidence and the financial system must be restored first.
"The challenge is growth. First growth, but make sure we have business confidence restored, investments expanding again, unemployment coming down, financial sector definitively repaired - that's our basic challenge," Geithner says.
Australian Treasurer Wayne Swan told reporters before going into the Apec meeting that "we have to do is to make sure that we don't withdraw global support too early."
"In Australia's case, our economic stimulus peaked in the middle of this year and is being gradually withdrawn as we go through the rest of the year," Swan said.
World Trade Organisation Director General Pascal Lamy also cautioned of a false dawn in the recovery.
"There's certainly a recovery happening, certainly in this region, which has suffered less from the crisis than from other regions of the planet," he told CNBC in an interview on the APEC sidelines in Singapore.
"But I would be prudent whether or not this would be sustainable six months or a year from now."
He said rising unemployment was the main threat to free trade and could spark greater protectionist policies around the globe.
Jobless queues have jumped across the industrialised world since the global economic crisis erupted a year ago and have been a prime reason nervous governments have resisted calls to start winding back stimulus measures.
The US jobless rate hit a 26.5-year high of 10.2% in October and economists polled by Reuters expect it to rise to 10.5% by the middle of next year.
Dollar worries
Meanwhile, the Obama administration says it is committed to a strong dollar and to actions aimed at bolstering its value.
"We recognise of course, as given the very important role of the US in the global economy, the important role the dollar plays in the system, that we bear a special responsibility for being a source of stability and strength to the global economy," Geithner says.
China has effectively pegged its currency against the dollar since the middle of 2008 to help fend off the global downturn.
Other APEC economies aside from China manage their currencies to some degree, including Singapore, Malaysia and Vietnam.
US President Barack Obama in an interview this week siad that he would raise the currency issue on a visit to China next week.
His administration says an undervalued yuan is one factor contributing to economic imbalances between the first- and third-biggest economies in the world.
Apec focus
Apec's trade and foreign ministers pledged to refrain from raising new barriers to trade and investment, and said a review of measures taken by member economies that began last July to ensure they were not protectionist would continue into 2010.
The main focus is an Asia Pacific free trade area which would account for about half the world's exports and imports.
Prime Minister John Key has now arrived to join other leaders at the Apec summit.
