G7 goes to war on the financial crimewave

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The Independent Online
FINANCE ministers from the world's seven biggest industrial countries threw their weight behind the struggle against international crime yesterday.

Meeting in London to discuss more predictable subjects such as the fallout from the Asian economic crisis, debt relief for poor countries and job creation at home, the ministers backed the creation of a world-wide anti- money laundering network.

Gordon Brown described international financial crime - from money laundering to tax evasion - as "one of the major challenges of our time".

The Chancellor, hosting the meeting ahead of next weekend's summit for heads of state and government in Birmingham, said: "This is a serious problem, and it is important to take action as soon as possible. It can only be dealt with by international co-operation."

Mr Brown said it was important to bring in countries such as those in central and eastern Europe which had so far stayed outside the international task force that already exists to combat financial crime.

He added that the meeting had agreed to crack down on the use of tax havens. The G7 would be pushing tax havens to reveal more information about their financial transactions.

The other main focus of the discussions yesterday and on Friday was how to ease the social problems that have arisen from Asia's financial crisis.

While the ministers - joined by Michel Camdessus, managing director of the International Monetary Fund, and James Wolfensohn, president of the World Bank - expressed satisfaction with the progress countries such as Thailand and South Korea have made in economic and financial reform, they have grown more concerned about poverty and unrest.

"Asia's problems can be solved in a few years; but without a concerted effort Africa's crisis will continue," Mr Brown said. The Chancellor reaffirmed Britain's commitment to see all the heavily-indebted poor countries starting to receive debt relief by the year 2000, although this initiative still has to overcome some resistance from other G7 members and the IMF.

The G7 ministers also agreed a series of measures to strengthen the "international financial architecture" to reduce the risk of future crises - while work has begun on drawing up a code for improved accountancy and auditing standards for companies seeking international investment.

"It is clear that we need new international rules of the game," Mr Brown said.

Africa squeezed, Business, p7