WORLD> America
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WORLD> America
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G20 to revive economy, reshape financial architecture
(Xinhua)
Updated: 2008-11-16 19:23 EMERGENCY RESPONSE At the Washington summit, the leaders also agreed to an action plan of immediate and medium-term measures to cope with the current global financial crisis. "Economic momentum is slowing substantially in major economies and the global outlook has weakened," warned the leaders. "Many emerging market economies, which helped sustain the world economy this decade, are still experiencing good growth but increasingly are being adversely impacted by the worldwide slowdown," it said. As immediate steps to achieve these objectives, as well as to address longer-term challenges, the leaders said they will: -- Continue their vigorous efforts and take whatever further actions are necessary to stabilize the financial system. -- Recognize the importance of monetary policy support, as deemed appropriate to domestic conditions. --- Use fiscal measures to stimulate domestic demand to rapid effect, as appropriate, while maintaining a policy framework conductive to fiscal sustainability. -- Help emerging and developing economies gain access to finance in current difficult financial conditions, including through liquidity facilities and program support. The leaders stress the IMF's important role in crisis response, welcome its new short-term liquidity facility, and urge the ongoing review of its instruments and facilities to ensure flexibility. -- Encourage the World bank and other multilateral development banks (MDBs) to use their full capacity in support of their development agenda, and the leaders welcome the recent introduction of new facilities by the World Bank in the areas of infrastructure and trade finance. -- Ensure that the IMF, the World Bank and other MDBs have sufficient resources to continue playing their role in overcoming the crisis. The joint efforts were immediately welcomed by the international organizations' leaders who are concerned that the economic crisis could become a human crisis. "The Secretary-general welcomes the Declaration of the Summit on Financial Markets and the World Economy, held in Washington D.C. today, which committed leaders to joint action," said a statement from UN chief Ban Ki-moon's office. He hailed the stimulus programs as an opportunity to promote "green economic development," and expressed support for renewable energy, conversion to more carbon-friendly systems, and investing in climate change adaptation measures in the most vulnerable developing economies. HUMAN CRISIS Calling for a rapid response to the spreading global financial crisis, many countries warn that the international community must not lose sight of the human crisis triggered by the financial crisis. Sharply tighter credit conditions and weaker growth are likely to cut into some developing countries' revenues and their ability to invest to meet education and health goals, as well as the infrastructure expenditures needed to sustain growth. Current estimates suggest that a one percent decline in the growth rates of the developing world pushes an additional 20 million people into poverty. Already, 100 million people have been driven into poverty as a result of high food and fuel prices, according to the World Bank. Ban Ki-moon said his greatest concern "is that today's financial crisis should not evolve into tomorrow's human crisis." "We cannot allow it to become a reason for neglecting other critical issues: unacceptable levels of poverty and hunger, the food crisis, climate change," said Ban on Friday. "For that will only exacerbate the already fragile political and security situation in many countries that hardest hit." After the five-hour summit, the leaders endorsed such calls in general terms. "We are mindful of the impact of the current crisis on developing countries, particularly the most vulnerable," said the leaders. "We reaffirm the importance of the Millennium Development Goals, the development assistance commitments we have made, and urge both developed and emerging economies to undertake commitments consistent with their capacities and roles in the global economy." The leaders also promised to address other critical challenges such as energy security and climate change, food security, the rule of law, and the fight against terrorism, poverty and disease. But some leaders also said it is important to turn words into deeds. "This summit of G20 leaders and the G20 meeting of finance ministers last weekend have begun to lay a productive foundation of discussion, input, and agreement," said World Bank President Robert Zoellick in a statement released after the summit. But "what matters now are the follow-up actions. People are looking to leaders for a global, coordinated and fast response," he said. "But the poorest developing countries must not be left out in the cold. We will not solve this crisis, or put in place sustainable long-term solutions by accepting a two-tier world," warned the World Bank chief. "If we are going to avert a human crisis, we will have to do more." |
