BRIC Reserves Help Sort Out Liquidity Crisis, Says Brasilinvest Boss Mario Garnero in Beijing
BEIJING, Oct. 25, 2011 /PRNewswire/ -- Mario Garnero, Chairman of Brasilinvest, Brazil's pioneer merchant bank, stated that BRIC countries foreign exchange reserves are helping keep interest rates in the neighborhood of 0% in OECD countries. His comments were made during 'The BRIC, The G-20: The Global Financial Architecture in Transition' Conference held in the Chinese capital by the 'Reinventing Bretton Woods Committee' in partnership with Tsinghua University.
The Reinventing Bretton Woods Committee was founded in 1994 and gathers as speakers Central Bank Governors, Ministers of Finance, academics, market participants, and members of international institutions. The Committee covers an agenda that includes international monetary coordination, crisis management and warning systems, mechanisms for disclosure, the role of the OECD, the creation of an international bankruptcy court, and other issues. It constitutes an early lead in bringing attention and fresh perspectives to issues addressed in forums such as the G-7 Summit, the IMF/World Bank annual meetings, the annual meeting of the multilateral development banks, and G20 meetings since the creation of this group.
Garnero argued that by investing a considerable portion of its reserves in Securities issued by OECD countries, "BRICs are making an important contribution to keeping overall international liquidity levels upwards", thus helping more mature economies build a smoother way out of the crisis". Garnero estimates BRICs current foreign exchange reserves at US$ 4.3 trillion, nearly half of the world's total. "BRICs reserves suffice to buy 80% of all NASDAQ-listed companies," he added.
He concluded that "BRIC reserves also signal these countries' indirect commitment to their fair share of responsibility in global financial governance. Doing more, however, would compromise BRIC's own duty to foster growth and jobs in their own economy. The US and Europe must also undertake austere structural reforms that may allow for a renewed period of confidence in the banking system without the looming prospects of spiraling sovereign debt."
CONTACT:
Anamelia Meirelles
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T: 55 11 3094 7984
SOURCE Forum das Americas
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