The "Committee of Twenty", charged with formulating a new world monetary system, hopes to have a final blueprint ready by July next year.
GV EXT. Kenyatta Conference Centre (2 shots)
SCU Chairman Committee of 20 speaks
SV Press taking notes (2 shots)
MR. WARDHANA: We have released today for publication a first outline of reform of the international monetary system. And, I think we have had a chance to look deeply into it. We have also released my ???vering report as Chairman of the Committee of Twenty, transmitting this first outline to the Board of Governors. This report explains the status of the outline. I think it is important to be clear on what the outline represents and what it does not ???present. It is not yet a blueprint for a reformed system. International monetary reform is a complex and difficult process and if??? cenuine reform it has to enforce changes in the pattern of cou???les behaviour, that have persisted for many years."
MR. SHULTZ "The need is for an ability to make commitments for new funds beginning on July the 1st. They run out of authority to commit. From the standpoint of the various governments, we presume... we think in the next room they are finally working out the details of the Fourth Replenishment Agreement. Assuming that that is done then at least, form the standpoint of the IS, and I won't attempt to speak for any other country, of course but form the standpoint of the US, we have to go through two processes. First, of course, the President proposes to the Congress what we will do and that's in the speech, and we will propose to the congress that the US contribute a third of this replenishment. Now, then the Congress has to act and it has to act in two senses. First it has to authorise the extension of this credit, and that goes through a certain set of committees and is voted on by the Congress. Then once there is authorising legislation, the Appropriating Committees take it up in the context of a particular Budget year. And until they have literally appropriated the money, the Appropriating Committees have pretty much said we can't be sure they will."
Script is copyright Reuters Limited. All rights reserved
Background: The "Committee of Twenty", charged with formulating a new world monetary system, hopes to have a final blueprint ready by July next year. This has been the major point to emerge form a conference of the International Monetary Fund and the World Bank in Nairobi, Kenya this week. It had originally been hoped that the conference would reach major decisions in the monetary field, but negotiators have so far failed to agree on many important points, Apparently the Committee's talks reached some agreement; that all countries would be subjected to scrutiny if their balance of payments showed a protracted surplus of deficit. It was also agreed that Special Drawing Rights, or "Paper Gold," should form the basis of the new system. But, after a year's work, the Committee still failed to agree on the mechanisms for implementing the new system.
The United States Secretary of the Treasury, Mr. George Schultz, said the stage should be set by next August for final agreement. By that time, Mr. Schultz said, the American basic balance of payments would swing back into surplus after three years of deficit. ??? said the United States would not attempt to establish a prescribed value for the dollar on foreign exchange markets until August. But, he said, it would continue to intervene on the markets form time to time to maintain orderly conditions.
The Chairman of the Committee for Twenty, Mr. Ali Wardhana, in a report to the conference, said the general shape of the reformed system had been defined, and significant progress on some important issues had been made. Paper gold was to become the principle reserve asset, with the role of gold and reserve currencies being reduced. Economic development and the flow of real resources form developed to developing countries were to be prompted.
THIS FILM INCLUDES STATEMENTS FORM MR. ALI WARDHANA AND MR. GEORGE SHULTZ. A TRANSCRIPTION OF THESE STATEMENTS FOLLOWS: