Beijing will staunchly defend the Hong Kong dollar peg, financier George Soros said last night.
'China will do its utmost to defend it,' he said in answer to a question from the South China Morning Post during the World Economic summit at Davos.
Mr Soros noted that Beijing might come under pressure on the currency front, but added: 'China will defend the Hong Kong peg to its dying breath.' Japan's Vice-Minister of Finance for International Affairs, Eisuke Sakakibara, agreed with Mr Soros, adding he believed Vice-Premier Zhu Rongji had also firmly committed Beijing to maintaining the value of the mainland's own currency.
Mr Soros warned that while the world was not facing a global financial collapse, 'if we don't learn the lessons from this [Asian] crisis, we will have a future crisis which will affect the centre, not the periphery'.
There was, he added, a need to control the global expansion of credit while the Asian situation needed to see a significant conversion of debt into equity.
