14 October, 2008

UNIPSIL

Statement by the Secretary-General on the Global Financial Crisis

The global financial crisis is hitting the world economy hard.  The concerted action taken by the finance ministers of key economies affected and by the International Monetary and Financial Committee of the International Monetary Fund (IMF) in Washington this weekend, aimed at restoring confidence in financial markets are laudable but more coordinated approaches, including direct intervention by governments of the major economies are necessary to recapitalize the banking system and guarantee the savings of ordinary people.

I am deeply concerned about the impact of this crisis on the developing world, particularly on the poorest of the poor and the serious setback this is likely to have on efforts to meet major goals. The initiatives by the World Bank and the IMF to provide new emergency liquidity provisioning to poor countries could help them counteract some of the consequences of this crisis. But more needs to be done.  

At the United Nations, we need to consider urgent multilateral action to alleviate the impact of recent events on the development agenda of the organization, covering the entire gamut of issues from the implementation of the Millennium Development Goals to the food and energy crises, as well as the challenges of climate change. In this context, I feel strongly that the Financing for Development Conference next month in Doha provides us an important opportunity to review developments and to ensure that the current financial difficulties do not undermine commitments already undertaken to provide more aid and other financial resources for the achievement of the internationally agreed development goals.

Meanwhile, the ad hoc manner in which governments have had to respond to the management of this crisis is reflective of serious lacunae in the current world financial system. To ensure continued stability and protect the economic gains of both developed and developing countries, we need to consider deep and systemic reforms based on an inclusive multilateralism for a global financial system that can better meet the challenges of the 21st century.

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