UK/USA: G7 PROPOSALS TO STRENGTHEN GLOBAL ECONOMY UPDATE

English/Nat The Group of Seven (G-7) leading industrial nations has announced new proposals to strengthen international financial systems in the wake of last year's Asian currency crisis. Statements were delivered by U-K Chancellor of the Exchequer, Gordon Brown, in London, and by U-S President Bill Clinton and U-S Treasury Secretary Robert Rubin in Washington on Friday. Among the central proposals for crisis prevention is an increased International Monetary Fund reserve to come to the aid of struggling economies. The U-K Chancellor of the Exchequer, and the Governor of the Bank of England, have welcomed proposals drafted by the Group of Seven (G-7) leading industrial nations to protect the global economy. Gordon Brown, speaking on behalf of Britain in its capacity as Chairman of the Group of Seven (G-7), made a statement from the Treasury in London on Friday afternoon. Brown was reporting the terms of a new agreement, reached by finance ministers and central bank governors of the G-7 countries, on detailed reforms to strengthen the global economy. The agreement was published simultaneously in each of the G-7 countries. The Chancellor emphasised that the financial crisis that swept through Asia last year, with reverberations felt around the world, exposed long-standing weaknesses in international financial systems. Friday's plan announced by Brown includes a mechanism for crisis prevention, a new process for global financial regulation, and new proposals for transparency and crisis resolution that each G-7 country will apply in future. Central proposals for crisis prevention include an increased International Monetary Fund (I-M-F) reserve. SOUNDBITE: (English) "The central element would be an enhanced I-M-F supplementary reserve facility which would provide a contingent short-term line of credit for countries pursuing strong I-M-F approved policies. This facility could be drawn upon in times of need and would entail appropriate interest rates along with shorter maturities. The facility would be accompanied by appropriate private sector involvement, and in appropriate circumstances, and up to individual governments, the facility could be complemented in individual cases by bilateral contingent financing." SUPER CAPTION: Gordon Brown, UK Chancellor of the Exchequer Brown said there would also be a new World Bank emergency facility to provide additional funding on special terms to the most vulnerable groups in society and for the restructuring sectors. Brazil is expected to become the first recipient of the emergency loans facility as the G-7 nations -- Britain, Canada, France, Germany, Italy, Japan and the United States -- have agreed to provide Brazil with more than 30 (b) billion (U-S) dollars in emergency aid from the I-M-F. In President Clinton's outline of the G-7's proposals he expressed enthusiasm at the outcome of the meeting. SOUNDBITE: (English) "Today I'm pleased to report that the world's leading economies have linked arms to contain the financial turmoil that threatens growth not only in emerging markets but in all markets of the world. The leaders of the major industrial economies have taken the following steps: This morning they've released a statement outlining our common agenda. First, we have agreed to establish a new precautionary line of credit anchored in the I-M-F to help countries with sound economic policies ward off the global financial crisis in the first place." SUPER CAPTION: U-S President Bill Clinton Clinton spoke of the far-reaching implications of the proposals for better global financial security in the future. SOUNDBITE: (English) SUPER CAPTION: U-S President Bill Clinton SOUNDBITE: (English) SUPER CAPTION: U-S President Bill Clinton You can license this story through AP Archive: http://www.aparchive.com/metadata/youtube/74d77ed9c7c153de9bb67e5ac9eba1a4 Find out more about AP Archive: http://www.aparchive.com/HowWeWork