Special Report: Global Financial Crisis
Backgrounder: World Economic
DAVOS, Switzerland, Jan. 30 (Xinhua) -- Global
cooperation, rather than a retreat from globalization, is the best approach for
solving the current financial crisis, world leaders said here Friday.
When attending the World Economic Forum annual
meeting in Davos, Switzerland, leaders from Britain, Mexico, South Korea and
South Africa agreed that global cooperation could set a pattern for dealing with
other international challenges, such as climate change, poverty and energy
Founder and Executive Chairman of the
World Economic Forum (WEF) Klaus Schwab (2nd L) speaks at the session "Why
We Need a New System of Global Cooperation?" at the Annual Meeting 2009 of
the WEF in Davos, Switzerland, on Jan. 30, 2009.(Xinhua/World Economic
They called for coordinated actions on a number of
areas, including fiscal and monetary policy measures to stabilize the global
financial system and revive economic growth, reform and recapitalization of the
major multilateral lending institutions, and a resumption of stalled free trade
talks to combat a dangerous turn to protectionism.
Public and private sectors should work together to
solve global problems, the leaders said.
"We need to recognize that these problems were
created by humans and can be solved by humans," British Prime Minister Gordon
"Rather than losing faith and letting the
protectionists take over, or returning to a failed laissez-faire model that says
there is nothing we can do, we have to grapple with these problems and prove we
can come together and solve them," he added.
Brown called on governments to consider "radical
options" for dealing with the problem, such as risk-sharing schemes that would
insure banks and other investors against further losses on toxic assets, saying,
"We need international discussion on what is the best model."
British Prime Minister Gordon Brown (2nd
R) speaks at the session "Reviving Economic Growth" at the Annual Meeting
2009 of the World Economic Forum in Davos, Switzerland, on Jan. 30, 2009.
(Xinhua/World Economic Forum Swiss-Image.ch)
Mexican President Felipe Calderon said one key lesson
from the previous crisis in the 1930s was the urgency for working out a policy
response, recognizing that delay increases both the economic damage and the
ultimate cost to taxpayers.
South Korean Prime Minister Han Seung-soo cited his
country's experience during the 1997-1998 Asian financial crisis as an example
of how great the costs of a financial rescue can be.
He said South Korea spent the equivalent of 16
percent of its GDP shoring up the country's corporations and financial
institutions during the crisis.
South African President Kgalema Motlanthe said
developed countries should put their own governance in order if they want to be
offered a better seat at the international table.
South African President Kgalema
Motlanthe speaks at the session "Reviving Economic Growth" at the Annual
Meeting 2009 of the World Economic Forum in Davos, Switzerland, on Jan.
30, 2009.(Xinhua/World Economic Forum Swiss-Image.ch)
Motlanthe also called for a speedy conclusion to the
stalled Doha Round of multilateral trade talks.
Meanwhile, the leaders warned that the financial
crisis might be generating a protectionist backlash in some countries, arguing
that such measures would risk a repetition of the disastrous collapse in world
trade during the 1930s.