At G-20, China Did Not Commit Bailout Funds Despite Huge Reserves

China got what it wanted in Washington’s financial summit — a promise of a bigger role for developing countries in global finance — but gave no sign Sunday whether it will respond by using any of its $1.9 trillion in reserves in a bailout fund.

By JOE McDONALD, AP Business Writer

China has been pushing for developing countries generally — and itself specifically — to have more influence at the International Monetary Fund and other global bodies. Analysts say that might be Beijing’s price to give in to foreign appeals to dip into its reserves and contribute money toward an IMF emergency loan fund for struggling countries.

The Washington summit was an “important and positive” step toward “the reform of the international financial structure,” foreign ministry spokesman Qin Gang said in a statement. It made no mention of possible bailout contributions, and a man who answered the phone at the ministry press office said he had no information.

Leaders from 21 nations, including China, and four international organizations attended the emergency two-day summit intended to address the financial crisis sweeping the globe.

Summit participants vowed Saturday at the conclusion of the two-day conference to cooperate more closely, keep a sharper eye out for potential problems and give bigger roles to fast-rising nations. But the leaders avoided many of the harder details leaving them to be worked out before their next summit, after President George W. Bush is gone and President-elect Barack Obama is in the White House.

China says it will cooperate with the IMF but Chinese officials say its most important role will be to preserve global growth by keeping its own economy healthy. Beijing announced a 4 trillion yuan ($586 billion) stimulus package last week, at a time of slowing economic growth and fears that falling exports could lead to layoffs and factory closures.

“China’s economic power is growing, so China could contribute and help ease the financial crisis,” said Wu Jinglian, a prominent economist and Cabinet adviser. “But the first priority is to keep our own economy growing. That will benefit every country in the world.”

A woman cooks while her husband playing computer games inside ...
A woman cooks while her husband playing computer games inside the prefabricated temporary housing in Yingxiu, Sichuan Province in China Nov. 8, 2008. Six months after the worst quake to hit China in three decades, the future remains uncertain for many survivors. Jobs are hard to come by, and government aid payments are about to end. Many people are still in temporary housing. China’s leaders have called reconstruction a priority. Last week, the government announced plans to pump $146 billion into the effort over the next three years. Some 120 billion yuan ($17.5 billion) will be spent on ensuring schools, hospitals and other public facilities are built to higher standards.(AP Photo/Andy Wong)

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http://news.yahoo.com/s/ap/20081116/ap_on_re_as/as_asia_meltdown_summit_1

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