The Chinese government said today that it “has faith in the European Union and the eurozone”, as well as taking measures to tackle its debt crisis, but refused to confirm whether Beijing will participate in the European Financial Stability Facility (EFSF).
The leaders of the euro have left the door open for China to come to the rescue of Europe and made it through the European Financial Stability Facility (EFSF) which increases its availability to a billion euros. This fund will have a mechanism for collecting contributions from China and other emerging markets like Brazil, but no one knows more than what was agreed at the summit this morning.
The official Xinhua news agency has described as “positive” but believes that the agreement “is fraught with difficulties.” Not without reason, since it remains to specify how that mechanism designed to raise funds outside Europe.
The specification is the work of Klaus Regling, EFSF president, who tomorrow travels to China in search of investors, including sovereign funds and investment funds, to participate in the European rescue. And China will move to Tokyo, which has said it would take “necessary measures” to support the Europe.
“We want the European Union recovers, it is vital to the global economy, and support their positive efforts, so we are willing to work with Brussels to overcome difficulties,” said Chinese Foreign ministry spokesman Jiang Yu.
Brussels has high expectations for Asian country’s participation in European Financial Stability Fund, but the spokeswoman gave no clue about the decision in Beijing.
The spokesman also confirmed that Chinese President Hu Jintao had telephone conversations with his French counterpart, Nicolas Sarkozy, to discuss the European debt crisis and finalize preparations for the summit of the G20 to be held next week in Cannes.
But China requires a reward to the possible contribution of between one and two billion euros. The Asian giant wants to be recognized as a market economy.
For its part, Germany and Slovakia are not willing to give that consideration to China and to obtain the qualification or status of market economy, saying it only meets one of five specified conditions.
Besides China, Europe will try to convince other countries like Brazil, South Africa and Russia.