China 'hopes' EU can resolve crisis

China's foreign ministry said today that it hoped European countries would overcome their temporary difficulties, as the political…

China's foreign ministry said today that it hoped European countries would overcome their temporary difficulties, as the political and economic crisis in Italy spurred fears of a split in the euro zone.

Ministry spokesman Hong Lei added that China also hoped Europe would stabilise financial markets and push for economic recovery and growth.

Borrowing costs for Italy, Europe's third-biggest economy, have soared to unsustainable levels as prime minister Silvio Berlusconi confirmed he would resign.

The escalating crisis prompted European Commission president Jose Manuel Barroso to issue a stern warning about the dangers of splitting the zone.

READ MORE

Pacific Rim countries are increasingly worried about Europe's worsening debt crisis and voiced the need to strengthen their own economies against the fallout, a senior US Treasury official said.

Finance ministers from 21 countries attending the Asia Pacific Economic Co-operation (Apec) summit are expected today to agree on Apec communique language that would reflect the call at last week's Group of 20 summit for more flexible exchange rates, including by China, the official said.

Speaking on condition of anonymity, the official said the Apec finance deputies discussed the worsening debt crisis in Europe and agreed that they all must take action to strengthen their economies in face of weakening demand from Europe. In many cases, this would require boosting domestic demand.

The Apec deputies did not discuss providing any aid to Europe, but focused mostly on the implications of weaker demand, the official said.

He said they drew the conclusion that it was more important than ever to ensure strong recoveries.