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From Benedicte Gravrand, Geneva: Amid the numerous announcement of the recent G-8 meeting of finance ministers, apparently, nothing very definite has been concluded. This was chaired by Germany whose agenda included the reduction of global imbalances, hedge fund transparency, bond markets in emerging countries, energy, financial governance in Africa and the IMF. Mr. Peer Steinbruck, Germany’s Finance Minister explained his views on hedge funds last month; whilst agreeing that hedge funds contribute to market efficiency, they also have the potential to cause financial instability on an international level.

The proposal was that the G8 countries should agree on imposing greater transparency and market discipline, not stricter regulations. However, the Financial Stability Forum charged with updating its 2000 report on "highly leveraged institutions" ahead of the meeting, had only come up with the argument that supervision should focus on risk management practiced by banks and financial institutions who work with hedge funds. A code of conduct or greater transparency were not part of the recommendations.

Despite support from the European Central Bank and some EU countries, Mr. Steinbruck did not convince the U.K and the U.S. So the proposal was amended to something that all finance ministers would agree to support: a code that emerged "spontaneously" and "voluntarily" from the hedge fund industry.

Hedge funds in G......................

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