Brazil to ask for more financial regulation at G20: Mantega

Tue Mar 10, 2009 9:21pm EDT

BRASILIA (Reuters) - Brazil will propose greater regulation of international capital flows at the G20 meeting, Finance Minister Guido Mantega said on Tuesday, in an attempt to iron out global capital imbalances.

Mantega said an important problem for the world economy at the moment is that the crisis created an imbalance in capital flows, which is also jeopardizing international trade.

Large capital flows to the United States for example is boosting the U.S. dollar and hurting exports, while emerging markets have less means to buy in the international market, he said.

"The countries with excess (capital) can put the resources in the International Monetary Fund and the IMF could then place these resources in emerging (markets), or those lacking resources," Mantega told a press conference in Brasilia.

"In this way you would re-balance the international economy, these financial resources could finance imports, (and act as) credit to international trade, reestablishing activity levels in the global economy."

(Reporting by Ana Nicolaci da Costa)