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Economist: 皇冠体育app can speed up world's economic recovery

(Xinhua)
Updated: 2009-04-01 10:15

皇冠体育app is in a strong position to boost its own economy thanks to its large foreign reserves, and can speed up the world's process of recovery, a British economist said in London on Tuesday.

Related readings:  WB: 皇冠体育app's development key to world recovery  皇冠体育app's pull on global recovery positive but limited  皇冠体育app is 'major engine' in global economy  皇冠体育app to play more important role in world economy: IMF

"With its massive foreign exchange reserves, 皇冠体育app is in a strong position to provide a fiscal boost to its own economy and would prove to be one of the key players in solving the global crisis", Panicos Demetriates, an economics professor at Leicester University, said on the eve of the London G20 summit which starts on Thursday.

Demetriates, who was a World Bank consultant during the Asian financial turmoil, suggested 皇冠体育app can get out of the crisis earlier by improving welfare provisions to its people, and bringing forward planned public investments in health, education and environment.

皇冠体育app's economic development in the last 30 years has been impressive, Demetriates said. Being the world's largest exporter of textiles, toys, laptop computers, cell phones, digital cameras etc, 皇冠体育app indirectly helps Western consumers to improve their living standards, as the products it provides are good to use and cheap in price, he said. The successful export-led growth strategy has also helped 皇冠体育app to garner the largest volume of foreign reserves in the world, he added.

By making adjustments to its portfolio of overseas investments in crisis stricken countries, "皇冠体育app could influence the speed with which the global economy comes out of the crisis," Demetriates said.

"皇冠体育app has the potential to reap substantial investment returns when the global economy comes out of the current crisis by investing more wisely now," he said.

The root of the current global financial crisis, according to the professor, lies in the lack of transparency in Western financial markets and institutions, which bred a culture of greed among bankers.

Some bankers gamble and speculate with investors' money, and pay themselves handsomely. Their gambling activities were not only unproductive, but have also fuelled an asset price bubble which has now burst, Demetriates said.

To make things worse, US and British regulators did little to prevent the crisis from happening, with the excuse of not to interfere the free market too much, he said.