October 29, 2014 / 10:17 AM / 5 years ago

Treasury's Lew says Europe needs responsible fiscal policy

U.S. Treasury Secretary Jack Lew pauses during remarks at the Peterson Institute for International Economics in Washington October 7, 2014. REUTERS/Jonathan Ernst

JOHANNESBURG (Reuters) - Europe needs responsible fiscal policy and to boost demand internally, U.S. Treasury Secretary Jack Lew told a business forum in South Africa on Wednesday.

He also said that concerns about China’s growth were exaggerated but that its policies had to be more market orientated.

The United States has warned that Europe risks falling into a downward spiral of falling wages and prices, and recently urged Germany to do more to help the continent by boosting demand in its own economy.

“In Europe there is a need for responsible fiscal policy and at the same time stimulating demand,” he told delegates in Johannesburg.

Lew is in South Africa on the last leg of an African tour that also took him to Egypt and Tanzania.

While China had the capacity in the short term to hit its growth targets, the risks were that it would defer the economic reforms necessary for growth, Lew said.

Washington and Beijing have long had differences over the value of China’s yuan currency, with the U.S. pushing for a move to a market-driven exchange rate.

Reporting by Mfuneko Toyana; Writing by Stella Mapenzauswa; Editing by Louise Ireland

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