China, India and Russia are increasingly calling for a rethink of how global currency reserves are composed and managed, underlining a power shift to emerging markets from the developed nations that spawned the financial crisis.
“There should be a system to maintain the stability of the major reserve currencies,” Bloomberg reported former Chinese Vice Premier Zeng Peiyan as saying in a speech in Beijing.
Leaders from China and India are preparing to join their counterparts from the Group of Eight industrialized nations – the United States, Japan, Germany, Britain, France, Italy, Canada and Russia – at a summit in Italy next week. In addition to China and India, Brazil will also send representatives to the summit.
Emerging markets continue to remain dependent on the U.S. dollar, thanks in part to the United States’ status as the world’s largest economy and a US$2.5 trillion export market. Shares of dollars in global foreign- exchange reserves increased to 65 percent in the first three months of this year, the highest since 2007 according to the IMF.