Sarkozy presses for capitalism summit
Richard Moore
Mr Sarkozy gave no detailed formula of how to address the crisis, but said the world should find a new system in which “whole swathes of financial activity are not left to the sole judgment of markets operators”.
Or a slide toward one-world government?At the moment, international economic institutions had neither the authority nor the instruments they needed to inhibit what he called the “anarchy of speculation”.The debate over how to tackle the financial crisis has fed into longstanding demands for reform of the UN and its institutions that have re-emerged as the sub-text of this year’s General Assembly.
Mr Bush left the financial crisis to the last section of his final UN speech. In a text that mentioned terrorism more than 30 times, he said the UN faced as serious a challenge as any since its founding – a global movement of violent extremists. “By delivering murder, by deliberately murdering the innocent to advance their aims, these extremists defy the fundamental principles of international order.”
Nicolas Sarkozy, the French president, called on world leaders on Tuesday to hold a summit later this year aimed at rebuilding a “regulated capitalism” to replace a world financial system that had become unhinged.
Addressing around 100 heads of state and government at the United Nations’ annual General Assembly debate, he said the financial crisis now unfolding was the most serious the world had seen since the 1930s.
It was the duty of leaders of those states most directly concerned to meet to examine the lessons learnt, the French president said.
His words followed those of George W. Bush, in his last address to the UN as US president, who sought to assure world leaders that his administration was on top of efforts to contain the crisis.
“We have taken bold steps to prevent a severe disruption of the American economy, which would have a devastating effect on other economies around the world,” said Mr Bush.
The administration and Congress were working on a bail-out package, he said, “and I’m confident we will act in the urgent timeframe required”.Mr Sarkozy, however, was among those who pressed for a world response, insisting on the reform of international institutions to meet the challenge.
“The 21st century world cannot be governed with the institutions of the 20th century,” he said, reflecting support by France and other governments for reform of the so-called Bretton Woods financial institutions established in the framework of the UN after the second world war.
Mr Sarkozy’s proposed summit would be likely to take place in the context of an expanded meeting of the Group of Eight industrialised states in November, to which the big new economies such as China, India and Brazil would be invited.
A summit in November would come after the result of the US presidential election was known, allowing Mr Bush to be accompanied by his successor.
Mr Sarkozy gave no detailed formula of how to address the crisis, but said the world should find a new system in which “whole swathes of financial activity are not left to the sole judgment of markets operators”.
The role of banks was to finance development and not to engage in speculation. Methods of rewarding executives should not drive them to take unreasonable risks and those who jeopardised people’s savings should be punished.
Brazil’s President Luiz Inácio Lula da Silva also called for greater international involvement in addressing financial market turbulence.
“A crisis of such magnitude will not be overcome with palliative measures,” he said. “Mechanisms for both prevention and control are needed to provide total transparency to international finance.”
“The global nature of this crisis means that the solutions we adopt must also be global, and decided upon within legitimate, trusted multilateral forums, with no impositions,” he said.
At the moment, international economic institutions had neither the authority nor the instruments they needed to inhibit what he called the “anarchy of speculation”.The debate over how to tackle the financial crisis has fed into longstanding demands for reform of the UN and its institutions that have re-emerged as the sub-text of this year’s General Assembly.
“Let us act so that our international institutions are more coherent, more representative, stronger and more respected,” said Mr Sarkozy.
Mr Bush left the financial crisis to the last section of his final UN speech. In a text that mentioned terrorism more than 30 times, he said the UN faced as serious a challenge as any since its founding – a global movement of violent extremists.
“By delivering murder, by deliberately murdering the innocent to advance their aims, these extremists defy the fundamental principles of international order.”
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