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Archive for Sunday, November 16, 2008

Summit participants vow action

November 16, 2008

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— World leaders battling a dire and deepening economic crisis vowed Saturday to cooperate more closely, keep a sharper eye out for red-flag problems and give bigger roles to fast-rising nations - but kicked many hard details down the road for their next summit after President-elect Barack Obama takes office.

Perhaps as important as the modest concrete steps they took, the leaders of the planet's richest nations - and some of the fastest-developing - made clear their recognition of the world's increasingly interconnected financial architecture and the responsibilities that go along with it.

"There shall be no blind spots," German Chancellor Angela Merkel declared. "There is here a great common will to ensure that such a crisis is not repeated."

Underscoring how bad things have gotten this time, President George W. Bush, the summit host, said he had agreed to the recent $700 billion rescue plan for U.S. financial institutions only after being told the nation was at risk of falling into "a depression greater than the Great Depression."

Also significant at the summit: the inclusion of a far broader range of countries than the elite, old-guard group that usually holds such summit meetings.

"Emerging market countries were not the cause of this crisis, but they are amongst its worst affected victims," declared Indian Prime Minister Manmohan Singh.

Leaders from 21 nations and four international organizations attended the emergency summit that was held as Washington was blanketed in a gray mist and which took on a workaday feel appropriate to the grim crisis that drew them together. At the conclusion of talks that took place over two days, they released a joint communique that was modest in scope but high in hopes.

Covering eight pages and 47 action items, the document's overarching focus is to establish a series of new safeguards for the fragile and opaque global financial system. Nearly all the efforts are aimed in some way at better flagging risky investment patterns and regulatory weak spots before they bring down companies and then ripple dangerously through entire economies, as has happened in recent months.

None of the items was splashy, and most would be understandable to few outside of financial experts, but officials argued they have far-reaching potential.

"It's not glamour," said French President Nicolas Sarkozy.

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