The European Commission (EC) put forward Wednesday proposals on reforming European and global financial systems to promote financial stability within the European Union (EU).
In a decision adopted Wednesday, the EC, the EU's executive arm, urged the EU summit on March 13-14 to "confirm the principles which will guide the EU's efforts to improve financial market transparency and reinforce prudent control and risk management, and to set out the broad lines of the action to be taken."
"We are asking EU leaders to confirm loud and clear that Europe will take an effective common approach to tackle the weaknesses exposed by the recent turmoil," said EC President Jose Manuel Barroso.
Those principles should include: primary responsibility for managing risk rests with individual financial institutions and investors; national regulatory and supervisory frameworks must be equal to the task of coping with rapid change and innovation in financial products; and cooperation between local and global regulatory authorities must be stepped up.
The broad "lines of action," both in terms of internal policy and in international fora, should include: improving information provided by credit rating agencies; updating accounting and valuation rules; encouraging prompt and full disclosure of losses of financial institutions; improving early warning systems on financial stability; strengthening the EU networks of financial supervision, particularly on the cross-border capitals; and working on a common framework for assessing a potential crisis.
In the meantime, the EC said the European economy is responding "relatively well" to turmoil in financial markets, the U.S. slowdown and high energy and commodity prices.
Despite some downward revision in the EC's recent interim economic forecast, projected growth of the EU this year remains at2 percent.
<i>Source:Xinhua</i>
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