President Dmitry Medvedev got a lukewarm response to his proposal for a new international reserve currency at a G20 summit Thursday, with world leaders focusing on the more immediate need to secure money to bail out the global economy.
Medvedev joined the other Group of 20 leaders in approving a $1.1 trillion deal to combat the deepest economic downturn since the Great Depression. They also signed off on plans to commission blacklists of tax havens and tighten financial rules to bring hedge funds and credit rating agencies under closer supervision.
The G20 summit took no action on Medvedev's idea to reduce reliance on the U.S. dollar, possibly by developing the Special Drawing Rights issued by the International Monetary Fund. But Medvedev insisted that the proposed international reserve currency remained a viable option.
"There is even a provision included in Clause 12 of the communique that we will make every effort to pursue a balanced monetary policy, financial and credit policy, which implies that we will return to this issue, discussing it both at the level of the International Monetary Fund and in the G20 format," Medvedev said at a news conference at the close of the summit.
The proposed currency "is not the easiest of subjects, and definitely no one had expected that we would make any decision on it," he said, Interfax reported.
Strengthened regional currencies would be a basis for the new unit, which could also be partially backed by gold, the Kremlin said in a statement released on the sidelines of the summit.
Both Russia and China in recent weeks have floated ideas about an international reserve currency. But the G20 summit focused first on promoting economic growth and repairing the financial system — not on the longer-term task of overhauling the foundations of the global monetary system.
The reasons for promoting discussion are that currency markets are extremely unstable, new regional currencies are strengthening and the euro's launch showed how it could promote fiscal discipline.
At the same time, countries with major currencies "do not bear sufficient responsibility for macroeconomic policies," the Kremlin statement said. The dollar currently is the world's largest reserve currency, followed by the euro, sterling, yen and Swiss franc.
"On this basis, we conclude that it would be wise to support the creation of strong regional currencies and to use them as the basis for a new reserve currency. One could also consider partially backing this currency with gold," the statement said.
"It is not our goal to destroy existing institutions or to weaken the dollar, pound or euro. We are simply calling for a joint assessment of how the global currency system can most favorably be developed for the sake of the global economy."
Accordingly, the Kremlin proposed that the IMF or a G20 working group prepare studies for review by G20 finance ministers and central bankers.
Medvedev, speaking at the news conference, also said U.S. President Barack Obama was ready to discuss different ideas on the deployment of a U.S. missile defense system in Europe, which Moscow strongly opposes.
"We touched upon this issue, and we agreed that our contacts and discussions on this issue would be continued," he said, a day after meeting with Obama.
"I got an impression that, at least on this issue, our [U.S.] partners do not hold a primitive position but are rather ready to discuss various ideas. And this is already crucial."
After Wednesday's meeting with Medvedev, Obama told reporters that he had accepted the Russian president's invitation to visit Russia in July.
In another sign of warmer ties, the Foreign Ministry in Moscow said Thursday that Russia was ready for possible cooperation with the United States on the transit of military equipment across its territory.
"Russia is ready for cooperation on this issue," Foreign Ministry spokesman Andrei Nesterenko told a news briefing, adding that Washington has not yet made an official request to send military cargo across Russian territory.
The United States is seeking more supply routes for international forces fighting in Afghanistan after militants in Pakistan stepped up attacks on supply convoys from the south.
The first cargo of U.S. nonlethal supplies such as construction materials crossed Russia last month, but officials say the United States is interested in sending military equipment too.
Later Thursday, Medvedev told students of the London School of Economics that he would be ready to talk to any leader of Georgia who would replace President Mikheil Saakashvili.
"We want to have good relations with Georgia, but I do not want to have any relations with President Saakashvili and will not deal with him," Medvedev said. "But if the authorities change sooner or later as part of a democratic process, we are ready to discuss any themes with them."
Medvedev joined the other Group of 20 leaders in approving a $1.1 trillion deal to combat the deepest economic downturn since the Great Depression. They also signed off on plans to commission blacklists of tax havens and tighten financial rules to bring hedge funds and credit rating agencies under closer supervision.
The G20 summit took no action on Medvedev's idea to reduce reliance on the U.S. dollar, possibly by developing the Special Drawing Rights issued by the International Monetary Fund. But Medvedev insisted that the proposed international reserve currency remained a viable option.
"There is even a provision included in Clause 12 of the communique that we will make every effort to pursue a balanced monetary policy, financial and credit policy, which implies that we will return to this issue, discussing it both at the level of the International Monetary Fund and in the G20 format," Medvedev said at a news conference at the close of the summit.
The proposed currency "is not the easiest of subjects, and definitely no one had expected that we would make any decision on it," he said, Interfax reported.
Strengthened regional currencies would be a basis for the new unit, which could also be partially backed by gold, the Kremlin said in a statement released on the sidelines of the summit.
Both Russia and China in recent weeks have floated ideas about an international reserve currency. But the G20 summit focused first on promoting economic growth and repairing the financial system — not on the longer-term task of overhauling the foundations of the global monetary system.
The reasons for promoting discussion are that currency markets are extremely unstable, new regional currencies are strengthening and the euro's launch showed how it could promote fiscal discipline.
At the same time, countries with major currencies "do not bear sufficient responsibility for macroeconomic policies," the Kremlin statement said. The dollar currently is the world's largest reserve currency, followed by the euro, sterling, yen and Swiss franc.
"On this basis, we conclude that it would be wise to support the creation of strong regional currencies and to use them as the basis for a new reserve currency. One could also consider partially backing this currency with gold," the statement said.
"It is not our goal to destroy existing institutions or to weaken the dollar, pound or euro. We are simply calling for a joint assessment of how the global currency system can most favorably be developed for the sake of the global economy."
Accordingly, the Kremlin proposed that the IMF or a G20 working group prepare studies for review by G20 finance ministers and central bankers.
Medvedev, speaking at the news conference, also said U.S. President Barack Obama was ready to discuss different ideas on the deployment of a U.S. missile defense system in Europe, which Moscow strongly opposes.
"We touched upon this issue, and we agreed that our contacts and discussions on this issue would be continued," he said, a day after meeting with Obama.
"I got an impression that, at least on this issue, our [U.S.] partners do not hold a primitive position but are rather ready to discuss various ideas. And this is already crucial."
After Wednesday's meeting with Medvedev, Obama told reporters that he had accepted the Russian president's invitation to visit Russia in July.
In another sign of warmer ties, the Foreign Ministry in Moscow said Thursday that Russia was ready for possible cooperation with the United States on the transit of military equipment across its territory.
"Russia is ready for cooperation on this issue," Foreign Ministry spokesman Andrei Nesterenko told a news briefing, adding that Washington has not yet made an official request to send military cargo across Russian territory.
The United States is seeking more supply routes for international forces fighting in Afghanistan after militants in Pakistan stepped up attacks on supply convoys from the south.
The first cargo of U.S. nonlethal supplies such as construction materials crossed Russia last month, but officials say the United States is interested in sending military equipment too.
Later Thursday, Medvedev told students of the London School of Economics that he would be ready to talk to any leader of Georgia who would replace President Mikheil Saakashvili.
"We want to have good relations with Georgia, but I do not want to have any relations with President Saakashvili and will not deal with him," Medvedev said. "But if the authorities change sooner or later as part of a democratic process, we are ready to discuss any themes with them."
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