November 21, 2008 / 12:43 AM / in 9 years

Americas and Asia business leaders urge fiscal response

<p>South Korea's President Lee Myung-bak (C) and his wife Kim Yoon-ok arrive at the airport in Lima November 20, 2008. Myung-bak was in Peru to attend the Asia-Pacific Economic Cooperation (APEC) summit. REUTERS/Enrique Castro Mendivil</p>

LIMA (Reuters) - Business executives from Asia and the Americas called on Friday for economic stimulus packages to offset the global financial crisis.

Backing promises by leaders of the world’s biggest economies to try to stave off recession by boosting demand, the executives also urged governments to resist protectionism and excessive regulation as a response to the economic woes.

“The required actions should include fiscal responses to strengthen demand through appropriate spending on public works and tax incentives,” Juan Francisco Raffo, president of the ABAC business council, said in Peru ahead of a 21-nation summit meeting here this weekend.

President George W. Bush, Chinese President Hu Jintao and the leaders of Japan, Canada, Mexico and Russia were among those expected to use the meeting of the Asia Pacific Economic Cooperation, or APEC, to push for free trade deals and stimulus packages to counter recessions that have already hit parts of the world.

“We call on the leaders of APEC members to take advantage of this opportunity to respond to the global economic crisis taking measures that put them on the road to recovery,” said Raffo, whose group advises the APEC leaders.

The APEC trade group accounts for more than 40 percent of the world’s people and more than half of global output.

Nine of its members are also in the G20 group of leading economies that last week agreed to take coordinated fiscal stimulus measures.

Bush was traveling on Friday to the APEC summit in Peru, his last scheduled trip abroad as U.S. president, to seek support for global financial reform.

APEC has often been criticized as irrelevant because it has never advanced with a regional free trade agreement, but its members have created a web of bilateral commercial pacts binding countries on both sides of the Pacific.

ALERT FOR ATTACKS

Days before Bush’s last visit to Peru, in 2002, leftist guerrillas killed 10 people when they exploded a car bomb near the U.S. embassy in the coastal capital Lima.

On Friday, thousands of police patrolled Lima to prevent any similar actions by insurgents, who recently have carried out a series of attacks in Peru’s Andes.

Hu arrived several days ahead of the presidential summit and pledged a greater role for China in Latin America, a major supplier of raw materials for Chinese industries.

Hu and Peruvian President Alan Garcia said they had concluded talks for a free trade deal and would sign a pact by March. It will be China’s second such deal with a Latin American country, after reaching one with Chile a few years ago.

Leaders arriving in Peru also said knocking down trade barriers and stimulating growth through government spending was not enough. In line with the G20 summit in Washington last week, they urged more controls on global markets to prevent future financial bubbles.

“Economies should consider if monetary policy, fiscal policy and prudential policy should be more counter-cyclical and lean against credit growth in an upswing,” New Zealand Prime Minister John Key told executives meeting ahead of the leaders’ summit.

It was not clear whether Philippine President Gloria Macapagal Arroyo would arrive at the summit as scheduled because her husband had a heart attack while they were flying from Manila to Los Angeles, and their airplane was diverted to Japan.

Writing by Fiona Ortiz; Editing by Kieran Murray

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