Dow Closes Down 86, Nasdaq Declines 3
The Associated Press, Fri 21 Feb 2003
NEW YORK (AP) — Investors already edgy about the economy got new reasons
to sell stocks Thursday with the release of four disappointing economic
reports. Ongoing worries about a potential war with Iraq and what it might
do to the economy depressed the market further.
Snow: War Worries Rattle World Economy
By JEANNINE AVERSA
Associated Press Writer
February 21, 2003, 2:42 AM EST
LONDON -- Entering his first international economic meeting, Treasury Secretary John Snow is focusing on how to energize a sagging global economy that is feeling the added drag of a possible war with Iraq.
Getting the world economy back to full throttle is one of the biggest challenges facing top finance officials from the seven largest industrialized countries as they gather Friday and Saturday in Paris, Snow said.
The task is being made more complicated as war worries shake business confidence and further damp global economic activity, he said.
"I think it is having -- the whole Iraqi situation -- is having a decided negative effect on economic activity," Snow told reporters Thursday before heading to France for the Group of Seven meeting.
Snow said he would be discussing President Bush's proposed new round of tax cuts, telling his colleagues the plan would not only help boost U.S. economic growth, but also aid other parts of the world.
U.S. officials are concerned that the United States, even with its uneven economic recovery, is still the only engine of global growth because Japan is stuck in a decade-long slump and growth in Europe is faltering.
"The strength of the international economy is tied to the performance of the U.S. economy," Snow said. "If it grows, it helps the rest of the world grow."
Federal Reserve Chairman Alan Greenspan also was to participate in talks as part of the winter meeting of the G-7 countries -- the United States, Japan, Germany, France, Britain, Italy and Canada.
Greenspan dealt Bush's tax cut program a blow last week when he told congressional committees that he was not convinced the U.S. economy needed any further stimulus to guarantee stronger growth this year.
"I'd like to see a broad-based consensus come out of the G-7 on the importance of more vigorous growth on a global basis," Snow said. "Now our growth focus will take the form of the president's tax program. That is the first order of business for us."
"In some other countries it may require some other set of initiatives to best promote growth," he added.
Snow said he believed the war issue would be an important backdrop at the meeting. He would not discuss whether he would be lobbying for financial support for any U.S.-led military effort against Iraq or in rebuilding after a war.
Still, he indicated it would be useful to develop a framework for dealing with those issues.
In terms of how to best get rid of the Iraqi uncertainty, Snow stuck to the Bush administration's stance.
"I think the appropriate response there is the one that the United States is pursuing -- to build a coalition that is willing to take the actions that are necessary to end the risks that Saddam Hussein poses for the world, and that by peaceable means, certainly, if possible," Snow said.
Snow used a stop in London on Thursday to bolster ties with financial officials in Britain, a close ally in the U.S. campaign to disarm Iraq.
The treasury chief had a full day of private meetings with British business leaders, economists and top finance officials centering on the delicate state of the global economy.
Snow, a former railroad executive with CSX, replaced Treasury Secretary Paul O'Neill, who was ousted by Bush in December in a shake-up of his economic team.
On Friday, Snow was expected to have one-on-one discussions with finance officials from France, Italy, Germany and Russia. A bilateral meeting with Japanese officials was set for Saturday.
Copyright © 2003, The Associated Press
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