Vienna, April 8 - European politicians teamed up with business leaders on Saturday to defend globalisation and denounce protectionism, arguing that freer trade and more open markets were good for both jobs and profits.
They also met 13 Asian finance ministers and prodded China in private to let its currency rise gradually in the interests of fairer competition in world trade, an official said.
The second day of a three-day gathering was mostly devoted to discussing technology advances and other changes that pitch countries and companies from opposite sides of the world into more head-on competition.
"Globalisation is very positive for Europe," said Nestle CEO Peter Brabeck-Letmathe, one of three business leaders who joined the European Union's 25 finance ministers and central bankers to discuss the impact of increasing competition worldwide.
"It's not true that globalisation has destroyed jobs. On the contrary. There have never been as many jobs in the world as today."
Bernd Pischetsrieder, head of carmaker Volkswagen, Europe's biggest exporter, defended plans to possibly axe 20,000 jobs in the next few years, arguing that failure to cut costs to better compete on world markets would cause even greater damage.
"It is reckless regarding long-term employment and regarding the security of our companies," he told a news conference headed by Karl-Heinz Grasser, Austria's finance minister and host to a three-day gathering on economics and globalisation.
French Finance Minister Thierry Breton, whose government has sparked street protests by millions of young people for trying to make it easier for firms to hire and fire, also defended the trend towards more intense worldwide competition.
"Globalisation is a reality and we need to see it clearly without naivity," he said.
The problem for business and politicians is selling the case when unemployment remains close to 10 percent in places such as France and Germany and when 2005 proved another bumper year for profits at many of those countries' multinational companies.
Opening the meeting with the Asians, Austria's Grasser said liberalisation, deregulation and privatisation was the only way to proceed and Austrian Chancellor Wolfgang Schuessel dismissed criticism of globalisation as shallow.
"Populist voices are quick to identify globalisation as the root of all evil," he said.
PROTECTIONISM
Following several cases where European governments opposed foreign bids to buy companies on their patch, notably in Spain, France and Luxembourg, several ministers spoke up to say protectionism had no place in Europe or anywhere else. British finance minister Gordon Brown said protectionism and the failure to liberalise energy markets properly was costing Europe billions of euros and should be shunned.
European Commissioner Charlie McCreevy, also at the talks, said some governments were not practising what they preached.
Controversy over what amounts to protectionism and hindrance to trade goes beyond Europe, with U.S. and European governments increasingly concerned about a flood of cut-price imports from China since the end of a decade-old quota system last year.
On Saturday, China acknowledged it was being summoned at the World Trade Organisation to explain itself on charges by Europe and the United States that it hinders exports of car parts.
Chinese Finance Minister Jin Renqing met the Europeans in Vienna, but a senior Chinese currency official travelling with him made it clear Beijing was not going to be rushed by others into letting its currency appreciate.
"Our government's position on yuan reform is a controlled gradual reform that is initiated by us," Wei Benhua, deputy director of China's State Administration of Foreign Exchange, said.
Jin, who held a separate meeting with European Central Bank chief Jean-Claude Trichet, European Commissioner Joaquin Almunia and Luxembourg Prime Minister Jean-Claude Juncker, said only that he hoped for improved financial cooperation with Europe.
A European official, who declined to be identified, said: "There were delicate suggestions from the European side that appreciation of the yuan should not be hindered, but no strong pressure".
Volkswagen's Pischetsrieder also complained about Japan's exchange rate, despite European politicians' comments about being generally happy with exchange rates at the moment.
"Today's exchange rate is what we have to live with as far as the dollar is concerned. With the yen, things are entirely different. Our Japanese competitors take lot of advantage from today's yen exchange rate," Pischetsrieder said.
The euro hit a record high against the yen on Thursday, at 144.92 yen. Against the dollar, the euro has been on an upward trend since mid-February, but dipped on Thursday and Friday to close at $1.2089.