Merkel Asks China to Help with Euro, Iran

During a three-day visit to Beijing this week, German Chancellor Angela Merkel will ask China to use its influence to persuade Iran to give up its nuclear weapons, while also seeking China’s support for the ailing euro.

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Merkel will present her case for China to institute tighter sanctions against Iranian oil exports in an effort to discourage the country from developing nuclear weapons. Merkel says she has already had “long discussions” with President Hu Jintao and Premier Wen Jiabao about the sanctions.

The United States originally proposed the embargo against Iran, and Europe soon joined the call. “The world must not have another power with nuclear weapons,” Merkel told an audience at the Chinese Academy of Social Sciences. “The question is, How can China make better use of its influence to make Iran understand that?”

But Chinese Premier Wen Jiabao appeared to reject pressure to do more on Iran, telling journalists after Merkel’s speech that China objected to Western nations politicizing the “normal commercial relationship” it has with the Islamic Republic.

Wen also said China is considering greater involvement in the stability funds that have been set up to help pull Europe out of its debt crisis. China is looking into how it can help, Wen said at a briefing with Merkel. He said solving the debt crisis is “urgent,” and called for greater international cooperation.

“China is also considering more participation” in those efforts via the European Financial Stability Facility and the European Stabilization Mechanism, he said.

The country will likely make use of its $3.2 trillion in foreign exchange reserves — the world’s largest stockpile — to help the euro, but wants more details on Europe’s plans first.

China is “investigating and evaluating ways, through the International Monetary Fund, to be more deeply involved using the ESM and EFSF channels in solving the European debt issue,” Wen said.

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To contact the reporter on this story: Emily Knapp at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com