UN creates task force on global economic crisis

Business Materials 21 October 2008 02:17 (UTC +04:00)

Just days after US and European leaders agreed to an emergency economic summit on US soil, the United Nations Monday announced the creation of a task force to review the role of the World Bank and International Monetary Fund (IMF) in the worst global finance meltdown since the Great Depression of the 1930s.

Economics Nobel Laureate Joseph Stiglitz is to head the group, the Interactive Panel on the Global Financial Crisis, which was to hold its first meeting October 30 at UN headquarters in New York, said Miguel d'Escoto, the president of the UN General Assembly, reports dpa.

Miguel d'Escoto said he set up the panel "in response to the current turmoil in the financial crisis."

The precise connection of the project to the economics summit was not clear, but US President George W Bush and French President Nicolas Sarkozy, the current head of the European Union, set a tentative date of soon after the November 4 US presidential elections.

With the backing of the 27-member European Union, which has been scrambling to keep finance systems afloat in the wake of the US economic collapse, Sarkozy and British Prime Minister Gordon Brown have called for rebuilding the global fnancial system from bottom up.

They have called for international agreement on a new financial order and global capitalism system, similar to the Bretton Woods agreements that founded the IMF and World Bank.

UN Secretary General Ban ki Moon has offered to host the global summit in New York. Sarkozy made clear on Saturday that he favours the New York venue because the crisis began there, and should be resolved there.

The UN panel is to undertake a "comprehensive review of the international financial system" and suggest steps to be taken by UN members "to secure a more stable global economic order."

Miguel d'Escoto said in a statement that there was growing recognition "that the current turmoil in the financial system cannot be solved through piecemeal responses at the national and regional levels but requires a coordinated effort at the global level."

He said developing countries have not been represented in the Bretton Woods institutions to fight for their economies. He said it is time for the world body to seek the design of a new economic architecture that is inclusive and democratic to be "credible and sustainable."

Miguel d'Escoto has called for democratizing the United Nations since he assumed the presidency of the 192-nation assembly in September, criticizing the world's major political and economic powers of dominating the UN.

He is a former foreign minister of Nicaragua's leftist Sandinista government in the 1980s, which fought the US government at the height of the Cold War.