REFORMING THE global monetary system and stabilising food prices will be on the agenda when President Nicolas Sarkozy visits his US counterpart Barack Obama today to discuss France’s priorities as chair of the G20.
Mr Sarkozy is also planning to raise the dollar’s dominance as a reserve currency, a fact he has previously cited as having contributed to the economic crisis.
“We hope, it’s in our interests, that the dollar continues to play a major role on the international scene,” said a senior official at the Elysée Palace. “But we think the balance of power between different currencies will change.”
France takes over the rotating chairmanship of the G8 and G20 this year and Mr Sarkozy plans to announce his priorities later this month. The president’s aides say he will use the trip to Washington to establish Mr Obama’s positions on issues such as excessive food price volatility, reform of the monetary system and the need to improve global governance.
Paris would like to strengthen the role of the IMF, which it believes has gained in legitimacy. “As we sense it, more multilateralism is the best answer to the increased instability in the world,” the official said.
The French plan to organise a series of “seminars” on monetary issues and hope to table their conclusions at a G20 summit in Cannes in November.
As France’s G20 presidency approached last year, Mr Sarkozy retreated from earlier criticism of the dollar and also toned down his disapproval towards China’s yuan, which the United States complains is kept artificially low, thereby having a negative impact on American jobs and competitiveness. “We have to update the international monetary system for the 21st Century,” Mr Sarkozy said at the G-20 summit in Seoul in November. At Davos a year ago, he said: “We can’t have on one hand a multipolar world and on the other hand a single reserve currency.”