G7 Plans - approving capital controls (fwd)

[Robert Weissman <rob@essential.org>]

G8 industrial powers to approve temporary capital controls: report
Date: Sun Jun 06 00:20:12 CDT 1999

   TOKYO, June 6 (AFP) - The Group of Eight will give their approval to
temporary controls over short-term capital flows at their upcoming summit in
Germany, a report here said Sunday.
   The G8 -- the Group of Seven industrialised powers plus Russia -- will
agree on the need for developing countries to adopt controls as an
"exceptional measure" while continuing to support the principle of free
capital movement, the Asahi Shimbun daily said.
   The G8 countries expect the temporary capital controls to help developing
economies avert the type of economic crisis seen in some Asian countries and
Latin America, the daily said.
   Massive outflows of international capital from Thailand in 1997 were
widely blamed for triggering the Asian currency crisis.
   The eight countries are also expected to agree on a stricter disclosure
requirement for hedge funds, the report said.
   The daily said last week that Japan would announce a waiver of 400
billion yen (3.3 billon dollars) in loans for heavily indebted nations at
the summit in Germany on June 18.
   The G8 comprises Britain, Canada, France, Germany, Italy, Japan, Russia
and the United States.


G7 to call on private banks in averting currency crisis
Date: Mon Jun 07 01:10:06 CDT 1999

   TOKYO, June 7 (AFP) - Finance ministers from G7 nations will call on
private financial institutions to cooperate to avert currency crises in
emerging economies, a Japanese finance ministry official said Monday.
   "G7 finance ministers will discuss how private financial institutions in
Japan, the United States and Europe can contribute to preventing currency
crises in emerging markets," the official said.
   Finance ministers from the Group of Seven industrialised nations will
meet in Frankfurt on June 12 to prepare the ground for this year's G7/G8
economic summit in Cologne, Germany.
   The ministers will also call on the International Monetary Fund to
provide emergency loans to developing nations, the official said.
   The Nihon Keizai Shimbun said earlier that under G7 proposals private
banks and the IMF would jointly give emergency loans to developing nations
facing currency crises.
   Private lenders would agree to a moratorium on loan repayment if approved
by the IMF, the daily said.
   The finance ministry official declined to confirm the report, saying
details have yet to be formulated, but he added: "It is very important to
seek cooperation from private banks in preventing currency crises."
   He said the IMF had already decided to establish a credit line to prevent
financial turmoil in developing nations.
   The G7 comprises Britain, Canada, France, Germany, Italy, Japan and the
United States.  Part of the summit will include Russia, which will then make
it a meeting of the G8.