World Bank chief says economic crisis remaking global power relations 2009-09-28 23:55:19   Print

    WASHINGTON, Sept. 28 (Xinhua) -- World Bank President Robert B. Zoellick said on Monday that the global economic crisis is contributing to shifts in power relations in the world that will impact currency markets, monetary policy, trade relations and the role of developing countries.

    In a speech ahead of the Annual Meetings in Istanbul, Turkey, of the World Bank and International Monetary Fund (IMF), Zoellick said leaders should reshape the multilateral system and forge a "responsible globalization" that would encourage balanced global growth and financial stability, embrace global efforts to counter climate change, and advance opportunity for the poorest.

World Bank President Robert B. Zoellick said on Monday that the global economic crisis is contributing to shifts in power relations in the world that will impact currency markets, monetary policy, trade relations and the role of developing countries.

File photo shows that Robert Zoellick, president of The World Bank, speaks at the International Economic Forum of the Americas conference in Montreal, June 8, 2009. (Xinhua/Reuters Photo)
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    "The old international economic order was struggling to keep up with change before the crisis," Zoellick told an audience at the Paul H. Nitze School of Advanced International Studies of the Johns Hopkins University, in Washington, D.C.

    "Today's upheaval has revealed the stark gaps and compelling needs. It is time we caught up and moved ahead," he said.

    In the speech entitled "After the Crisis?" Zoellick said "Peer review of a new Framework for Strong, Sustainable and Balanced Growth agreed at last week's G20 Summit is a good start, but it will require a new level of international cooperation and coordination, including a new willingness to take the findings of global monitoring seriously. Peer review will need to be peer pressure."

    It was also important for the G20 to remember those countries not at the table.

    "As agreed in Pittsburgh last week, the G20 should become the premier forum for international economic cooperation among the advanced industrialized countries and rising powers," said the World Bank chief. "But it cannot be a stand-alone committee. Nor can it ignore the voices of the over 160 countries left outside."

    China's strong response during the economic crisis and rapid recovery had underscored its growing influence as a stabilizing force in today's global economy, he said.

    But its leaders face challenges caused by rapid credit growth and the economy's dependence on exports, he added.

    The United States had clearly been hit hard by the crisis. Its prospects depend on whether it will address large deficits, recover without inflation, and overhaul its financial system, according to Zoellick .

    The United States has a history of recovering from setbacks. "But the United States would be mistaken to take for granted the dollar's place as the world's predominant reserve currency," Zoellick said, "Looking forward, there will increasingly be other options to the dollar."

    The crisis has brought to the attention of lawmakers the significant role played by central banks.

    Central banks performed well once the crisis hit but their role in the build-up was less convincing.

    "In the United States, it will be difficult to vest the independent and powerful technocrats at the Federal Reserve with more authority," said Zoellick.

    "My reading of recent crisis management is that the Treasury Department needed greater authority to pull together a bevy of different regulators," said the former U.S. Deputy Secretary of State.

    "Moreover, the Treasury is an executive department, and therefore Congress and the public can more directly oversee how it uses any added authority," said Zoellick.

    Developing countries had already been on the rise before the crisis and their position has been further strengthened because of it. Their growing share of the world economy was a positive development.

    "Looking beyond, a more balanced and inclusive growth model for the world would benefit from multiple poles of growth," Zoellick said. "With investments in infrastructure, people, and private businesses, countries in Latin America, Asia, and the broader Middle East could contribute to a 'New Normal' for the world economy."

Global economic crisis not over yet, at least for the poor, UN report says

    UNITED NATIONS, Sept. 18 (Xinhua) -- Despite "green shoots" of recovery, the world economic financial and economic crisis is still not over yet, at least for the millions of the most vulnerable who cannot make the ends meet everyday, the United Nations warned on Friday.

    "The 'near poor' are becoming the 'new poor,'" UN Deputy Secretary-General Asha-Rose Migiro told reporters in New York at the launch of the Voices of the Vulnerable: the Economic Crisis from the Ground Up report. Full story

U.S. sees debt, deficit everywhere one year after economic crisis

    WASHINGTON, Sept. 23 (Xinhua) -- One week before the U.S. fiscal year 2009 ends on Sept. 30, top U.S. officials may not volunteer the unsettling news on the federal budget deficit and America's record-breaking public debt at the G20 Summit in Pittsburgh.

    According to the White House's own estimate, the federal government's deficit for the fiscal year 2009 would reach 1.84 trillion U.S. dollars, roughly 13 percent of the estimated GDP. This would be the highest level since 1945 when the United States was involved in a world war. Full story

China to come out of economic crisis strong: analyst

    MOSCOW, Sept. 17 (Xinhua) -- China has fought off the economic crisis and will be among the strongest countries to weather the impacts, political analyst and Newsweek editor Fareed Zakaria said in an interview with Xinhua.

    Zakaria, also a CNN host, said some of the decisions made by the Chinese government before the crisis could be seen as "very wise." Full story

Climate change, economic crisis taking heavy toll on Caribbean, leaders tell UN

    UNITED NATIONS, Sept. 26 (Xinhua) -- While climate change and the global economic crisis are a challenge for all, they are particularly difficult for the small, island nations of the Caribbean, several leaders from the region told the United Nations General Assembly here Saturday.

    "It is a fact that when global crises occur small vulnerable economies tend to pay a disproportionately high price," Prime Minister Denzil L. Douglas of Saint Kitts and Nevis said, as he addressed the Assembly's annual high-level debate. Full story

Global financial crisis turns into real economy crisis: World Bank chief economist

    WASHINGTON, July 9 (Xinhua) -- The current global financial crisis, the most severe since the Great Depression in the 1930s, is rapidly turning into a real economy crisis and it's too early to say that the crisis has already bottomed, World Bank Chief Economist Justin Yifu Lin said in a recent exclusive interview with Xinhua.

    "The collapse of the financial sector can be avoided. And the people's confidence is restoring," after the developed countries tried all out to rescue their economies, said Lin, who is also senior vice president for Development Economics at the World Bank. Full story

Special Report:  Global Financial Crisis

Editor: Mu Xuequan
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