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MEP Daianu: New international financial architecture requires EU-27 common stance

Attending a debate held during the European Parliament's mini-plenary session dedicated to the future architecture of global financial markets, Romanian MEP Daniel Daianu (of the National Liberal Party, PNL) underscored that the 27 EU members need to agree upon a common stance to favor reforms, reads a Thursday press release.

'If we fail to effectively reach a common stance within the EU to favor genuine reform, setting in force new and efficient global rules for financial markets becomes far more difficult,' warned Daianu, pointing to the massive failure of regulation and supervision along with the proven flaws of a simplistic economic philosophy as the indubitable source of the current situation and where plenty of betterment action should be taken. 'Yet others would say that a permissive regulation should be the key to the new system. In my opinion they are wrong, no matter if they truly believe what they are saying or are driven by petty coterie interests,' said Daianu.

In his opinion, the conception according to which highly volatile capital flows are hostile to trade and prosperity has proven its relevance in this 'immense disaster,' just like in other crises, emerging markets included.

Daniel Daianu considers that the theory according to which not much can be done about financial flows when they turn into a source of suffering is unconvincing. 'Much can be done to regulate all financial entities (hedge funds and private investment funds included), to constrain leverage, about pro-cyclicity and accounting, for better coordination of policies, etc.'

The decline of a paradigm that equals market economies with the absence of any regulation must be considered in relation with an emerging multi-pole world in the attempt to build a new international financial system. The fate of an open global economic system depends on it, said the Liberal MEP.

'If we do not do what is needed, we risk to witness the system's falling apart and the crippling of liberal democracies. I hope the new US Administration will prove the necessary openness for that. But we, at home in Europe, need to live up to the importance of this period,' added Daianu.

 

Sursa: http://www.rompress.ro

Tags: daianu financial stance common

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