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EVIAN (France), June 2: Leaders of the G8 industrial nations are optimistic that economic recovery will kick off this year while rejecting intervention against the soaring value of the euro, a senior German official said Monday.
The United States projects growth of 2.9 per cent for the second half of 2003, said German Chancellor Gerhard Schroeder’s summit sherpa at the G8 meeting, Alfred Tacke.
“Our joint position is that the economic burdens from the first half of this year have fallen away,” said Tacke at a news conference.
Interest rates were down, oil prices stable and moves toward peace between Israel and the Palestinians provided hope, he said.
The most important means to promote faster growth were structural reforms such as those being prepared in Germany, he said.
Mr Tacke side-stepped fears that a strong euro and weak dollar could harm euro zone recovery chances by making exports too expensive.
The euro last month surged to its highest ever rate against the dollar since being launched in 1999.
STRONG DOLLAR: U.S. President George Bush said he was committed to a strong dollar but played down his influence over exchange rates when Group of Eight leaders discussed the currency’s recent tumble in France on Monday.
White House spokesman Ari Fleischer said on the margins of the G8 meeting in Evian on the French shores of Lake Geneva: “The president’s position is that the United States supports a strong dollar and a strong dollar is determined by the market and that’s why it is important to secure policies that advance growth in the United States.”
European Commission President Romano Prodi, invited to the meeting of the big industrial hitters, said: “Bush stated strongly that he doesn’t want a weak dollar.”
Currency markets seemed to take the comments positively, with traders partly attributing marginal gains in the dollar on Monday to the fact that G8 leaders were at least discussing the issue.—Reuters
