World Economy

Asian, European finance ministers hold talks

Finance ministers from Asia and Europe began talks Monday expected to focus on challenges buffeting the world economy, including global financial turmoil and skyrocketing costs for food and fuel.

The ministers were meeting for the eighth time since the establishment of the Asia-Europe Meeting, a dialogue and cooperation body that brings together the 27-member European Union and 16 Asian countries including economic powerhouses Japan and China.

South Korean President Lee Myung-bak, whose government is facing a strike by truckers angry over the rising cost of fuel and other issues, addressed the opening of the meeting. He told participants that international financial market disruption has caused a global economic slowdown.

"On top of that, the rising prices of oil food and raw materials has generated the largest crisis since the oil shock in the 1970s," he said. "Some Asian countries are faced even with a food crisis."

French Finance Minister Christine Lagarde, one of the most high-profile officials at the meeting, said at a conference Sunday that the financial, fuel and food crises affecting the world economy -- which she dubbed the "three Fs" -- are interrelated and need to be tackled with that in mind.

"To fix one, we need to fix the others," she told reporters. "So I think it's critical that we, number one, bring some stability back to the financial markets."

The actual number of finance ministers attending the one-day meeting was relatively small. Of the five Group of Eight countries that belong to ASEM, only two -- Japan and France -- sent their ministers.

G-8 finance ministers met late last week for two days of talks in Osaka, Japan.

Besides the 10 members of the Association of Southeast Asian Nations, the Asian contingent is rounded out by China, India, Japan, Mongolia, Pakistan and South Korea.

ASEM represents 51 percent of the world economy as measured by gross domestic product, and 62 percent of global trade, South Korean Strategy and Finance Minister Kang Man-soo told the meeting.

"Asian countries are experiencing rapid growth and are now the most dynamic in the world economy," Kang said, encouraging Europe to take an ever greater interest in Asia.

Other topics up for discussion at this year's ASEM finance meeting, held on the South Korean resort island of Jeju, include micro-finance and climate issues.

The ASEM finance ministers last gathered in Vienna, Austria.

ASEM leaders and foreign ministers also hold meetings every two years. The first ASEM Summit was held in Bangkok in March 1996.

(Published by AP - june 16, 2008)