Russia and China Spearhead move To a Global Currency

Pope Benedict issued his encyclical coinciding with the G8 summit meeting in Rome, Italy. The Pope recommended enforcing strict policies on the regulation of world economy.

According to a news source Pope Benedict issued his encyclical coinciding with the G8 summit meeting in Rome, Italy. The Pope recommend to foreign leaders enforce strict policies on the regulation of world financial systems. The document called for "a true world political authority ... to manage the global economy" and avoid more "abuse" of the free market. Tuesday, officials reported that Russia, China and Brazil are expected to use this week meetings to spearhead a move towards a global currency. Although it is not expected that the issue of a world currency will be given formal mention at the summit, it is very likely that Russia, and emerging power Brazil, who is also a member of the G5, will lend their voices to China’s call for a debate amongst members of the G8 on a world currency. Topic economic Russian aide Arkady Dvorkovich, said that China and Russia were ready to “state their stance that the global currency system needs smooth evolutionary development.” Brazilian President Luiz Inacio da Silva, expressed he wanted the need for a global currency to be “the possibility of new trade relations not dependent on the dollar”. India has also said it is open to the debate, however, Germany, France, and Canada have downplayed the possibility of a discussion on a global currency. An official at President Sarkozy’s office said the G8 was “generally not the forum ... for discussing currency exchange rates.” German Finance Minister Peer Steinbrueck said Monday that the dollar was likely to stay as the global currency, however, it appears that the Chinese yuan and the euro is growing in importance. The debate over a single world currency is considered vulnerable at best, with economic markets cautious it may jeopardize U.S. asset values. China and other countries promoting a world currency should be mindful over the sensitivity to those promoting U.S. economic interests. No doubt, Italy will have it's hands full trying to avoid the riots that occurred at previous meetings. Italy is 'beefing' up it's security during discussions at this years talks especially with the possibility over a single world currency debate. Nonetheless, China upholds that continued reliance on current dollar and economic methods has only aggravated the world’s financial crisis. China sees the drawing power of the International Monetary Fund (SDR), based on a collection of currencies, as a solution to the current worldwide economic state. Silvio Berlusconi, the G8 Summit host, said the summit would also focus on a Friday meeting with nine African leaders and food agencies would also focus on the launch of a $10-15 billion initiative on food security, of which the U.S. has contributed $3-4 billion. The summit would also take a look at agreeing to tighten the differences over cuts in greenhouse gas emissions and funding devoted to low-carbon technology. The G8 will also discuss the goal of limiting global temperatures to 2 degrees Celsius (3.6 Fahrenheit) and cutting in half the carbon emissions by 2050. Also on the table will be a debate on whether Iran should have sanctions imposed because of the post-election violence and its nuclear program. Some members wanting to sanction, while “others saying sanctions never obtained great results”. Either way, the G8 talks will open with discussions on the current worldwide economic crisis and the question of a world currency may be broached. Prime Minister Berlusconi is keen on conveying optimism in the meetings that are being held in Rome.