New Delhi, March 29 (IANS) The world’s leading emerging economies Thursday asked for increased global cooperation to stem excessive capital inflows into their respective countries as it could play havoc with commodity prices among other things and affect growth.
“Excessive liquidity from the aggressive policy actions taken by central banks to stabilize their domestic economies have been spilling over into emerging market economies, fostering excessive volatility in capital flows and commodity prices,” Brazil, Russia, India, China and South Africa said in a joint declaration after their one-day summit here.
The BRICS countries said the developed economies should look at making structural reforms to raise growth rather than adopt aggressive monetary policies and put global economic stability in jeopardy.
“We believe that it is critical for advanced economies to adopt responsible macroeconomic and financial policies, avoid creating excessive global liquidity and undertake structural reforms to lift growth that create jobs,” said the declaration.
The call to restrain huge capital fund flows from western countries came a day after President Dilma Rousseff of Brazil held developed economies responsible for a “monetary tsunami” which was threatening to derail growth of his and other emerging countries.
“We draw attention to the risks of large and volatile cross-border capital flows being faced by the emerging economies,” the joint declaration said.
“We call for further international financial regulatory oversight and reform, strengthening policy coordination and financial regulation and supervision cooperation, and promoting the sound development of global financial markets and banking systems.”
