G20 warns of risks hurting global economy, financial markets

Chinese Finance Minister Lou Jiwei(R) speaks at a press conference on G20 Finance Ministers and Central Bank Governors Meeting at the headquarters of International Monetary Fund(IMF) in Washington D.C., the United States, Oct 7, 2016. Global economy continued to face uncertainty and rising risks, Lou Jiwei said on behalf of the G20 economies on Friday.[Photo/Xinhua]

WASHINGTON - Global economy continued to face uncertainty and rising risks, Lou Jiwei, China's Finance Minister, said on behalf of the G20 economies on Friday.

Uncertainty and risks, including elections in major economies, uncertain fallout of Brexit, rising expectation for rate hikes by the Federal Reserve, increased geopolitical risks and terrorist attacks, could have significant repercussions for the global economy and international financial markets, said Lou at a press conference after the G20 policymakers concluded their meeting in Washington.

Lou said that G20 economies will continue to closely monitor the developments, strengthen policy coordination and delivered the commitments made at the G20 Hangzhou Summit in September in China.

When asked about the Brexit process and possible related financial turmoil, German Finance Minister Wolfgang Shauble, who will chair the G20 meetings next year, said at the press conference that EU institutions stood ready to negotiate.

He added that capital flows and volatility in currency markets are always a concern for G20 economies.

In this regard, Lou added that financial markets tend to magnify uncertainties and overreact.

When asked about China's rising credit, Lou said that China's central government debt level remained at a healthy level, with the debt to GDP ratio at around 18 percent.

China has taken measures to improve the supervision and regulation of local government debts, and strengthen budget constrains over local governments, according to Lou.

The risks related to the local governments debts are under control, said Lou.