The EU reached a tentative agreement on its proposals for the summit financial

Ministers of Economy of the Twenty-seven have reached a tentative agreement on proposals to be presented by the European Union in the financial summit to be held in Washington next November 15. Among the measures agreed upon include the strengthening of the role of the International Monetary Fund (IMF). However, attendees have downgraded the claim of France to regulate all actors and financial instruments.

The French Minister of Finance and chairman in office of the Ecofin, Christine Lagarde, said that proposals from the presidency gala had received a "massive support" of the Twenty-seven. "We should not over-regulate, but clearly we want to ensure that they do not leave black holes in regulation," said Lagarde, who has stressed that the IMF must be the "centerpiece" of the new financial architecture.

However, the second vice president of government and minister of Economy and Finance Pedro Solbes, has said that the French document "has been corrected in a very substantial" by the contributions of other member states. "At the end there is no requirement to submit the financial world that has now worked off the balance sheets of banks to these accounts in results," he explained.

"Yes it is emphasized that there are codes of conduct to avoid undue risk to the financial industry," said the minister. He also explained that "everybody agrees" on the need to strengthen the IMF to play "a key role in terms of control." He also stressed that given a greater role in the Financial Stability Forum linked to the IMF.

In his speech behind closed doors during the Ecofin, Solbes has also advocated that the reform of the financial architecture does not affect the free trade nor to the Millennium Development Goals of reducing poverty and to take into account the points of view of the emerging countries, according to diplomatic sources.

For his part, present "a common and unified position" on the summit of Economic Affairs, Joaquin Almunia, has bet that the G-20 and in Washington. "We must strengthen the effectiveness of the actions of the IMF, to align its priorities and instruments of action to match the needs of the global economy," he insisted.

The French presidency will now amend its proposals paper taking into account the suggestions of the finance ministers and submit it for discussion at the summit of heads of State and Government to be held on November 7 in Brussels to prepare The financial conference in Washington.

Reform of the IMF and the G8

France proposes reforming the International Monetary Fund (IMF) and the G-8 to emerging countries like China or India to have greater representation. The aim of these changes is to enhance the legitimacy of the international financial architecture to achieve greater coordination to prevent future crises.

The EU also wants to introduce other reforms in the IMF so that this body is better equipped to give financial assistance to its members in situations of lack of liquidity or as the crisis they are experiencing such countries as Hungary or Ukraine.

Moreover, the paper said that the president "should be studied further reforms of the G-8 to make this group better represents the emerging countries".

Proposals for Brown and Sarkozy

The French

Document contains a number of proposals to reform the international financial system that have made over the past few weeks both the British prime minister, Gordon Brown, as the French president, Nicolas Sarkozy.

From

Brown comes the idea of creating an early warning system that would allow early identification of risks to global economic and financial stability and making quick decisions to mitigate them. In this system would involve the IMF, supervisors, central banks and regulators, and it would be one way to ensure that the information arrives on time for the political authorities.

The French presidency is proposing to create "quickly" colleges of supervisors to improve the monitoring of all major cross-border banks. This measure has also been the flags of the British prime minister, who asked that before the end of the 30 largest financial institutions in the world are monitored by supervisors in the schools of involving the authorities of all countries where these banks having activities.

The text also calls for intensifying the fight against tax and financial matters. Another proposal by the French president who will take the Washington Summit is to develop codes of conduct to ensure that the salaries of managers push to take excessive risks. Twenty-seven bet on the strengthening mechanisms for dealing with risks in financial institutions and they are directly dependent on the direction of the company, especially to avoid "incidents operating in market operations."