Posted October. 23, 2010 13:26,
G20 finance ministers struggled to find common ground Friday to prevent a currency battle at the start of a two-day meeting in Gyeongju, North Gyeongsang Province.
Korea issued a draft statement urging countries to shun the competitive depreciation of their currencies, and induced the finance chiefs to sign an agreement. Vice finance ministers will fine-tune the statement for their superiors and an announcement is expected Saturday.
U.S. Treasury Secretary Timothy Geithner blasted China Thursday in an interview with a U.S. daily, saying the Chinese yuan is excessively devalued.
Japanese Finance Minister Yoshihiko Noda also told Japanese reporters, Foreign exchange rates should reflect the countrys economic fundamentals, criticizing Chinas massive current account surplus.
In response, Beijing said it can sign the agreement if the currency appreciation proposal is similar to the one made at the G20 Toronto summit in June on a flexible currency, a source attending the meeting said.
Seoul wrote in the statement, A currency system reflecting economic conditions should be created and countries should avoid sudden currency fluctuations.
The Korean government is known to have induced agreement by the participants based on this statement.
An official helping preparation for next month`s G20 summit in Seoul said, Since the U.S. is very firm in its efforts to resolve the currency matter, it could induce a stronger level of agreement than Koreas draft statement."