Asia-Pacific finance ministers at their meeting next week will call for increased policy coordination between oil-producing and -consuming states, including the launch of annual dialogue in the International Energy Forum, to curb surging oil prices, according to a draft joint statement.
The ministers from the 21-member Asia-Pacific Economic Cooperation forum will also call for ensuring a stable oil supply, promoting new technologies and reducing fuel subsidies in a bid to stabilize record-high oil prices, which have hovered around $70 a barrel, says the draft of the statement, which will be issued after the Sept. 8-9 meeting on Cheju Island, South Korea.
The draft, a copy of which was obtained Friday by Kyodo News, says the ministers want to strengthen producer-consumer tieups through such means as “the establishment of an annual dialogue and flexible ad hoc meetings in the IEF.”
The Riyadh-based IEF is a forum for energy-producing and -consuming countries and holds ministerial meetings every two years to discuss the world’s energy issues. The next meeting is slated for April in Doha.
The draft says the APEC finance ministers “recognized the need to remove disincentives to investment in oil production and refining capacity and to promote new technologies” as part of efforts to ensure sufficient production.
They “welcomed recent actions to reduce demand-distorting subsidies and urged continuation of these efforts,” it says, alluding to fuel subsidy reduction plans by Indonesia and other Asian economies, which experts have said would help give a true picture of demand.
Despite high oil prices, the APEC ministers voice confidence in the world and regional economies, saying in the statement, “Global economic growth moderated in 2005, but is still likely to remain robust.
“Through the growth in APEC regions is expected to ease in 2005, we observe that member economies are experiencing faster growth than the global economy.”
Although the draft makes no reference to currency issues, it is widely believed that the APEC ministers will discuss them during the upcoming talks, with China apparently wanting credit for its revaluation of the yuan in July and no calls for a further revaluation, sources said.
But while welcoming the initial 2.1 percent revaluation of the yuan, the United States is likely to request that the statement include a call on China to let the yuan’s value rise to get greater flexibility in China’s exchange-rate program, the sources said.
Japan plans to say during the meeting that it expects China to run the new managed floating system more smoothly, a Finance Ministry source said, an indication Tokyo will side with Washington on yuan reforms.
As population growth slows in some APEC economies, including Japan, the ministers “acknowledged the urgency and the importance of domestic fiscal and financial market reforms,” the draft says.
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