Post Finacial Crisis Resulting in the Formation of a New World Order

[I AM NOT THAT GUY 5,715]

Take heed of protestors’ voices while drawing new world order

Prime Minister Recep Tayyip Erdoğan has called on International Monetary Fund (IMF) and World Bank leaders to take into account the voices of protestors when formulating the post-crisis “new world order.”

His comments came yesterday during the opening of the IMF-World Bank Annual Meetings while reaffirming Turkey's commitment to working with the IMF and the World Bank to reform institutions, making them more inclusive of their diverse membership, and representing shifting power realities of the day. Like an increasing number of voices at the forum, he emphasized that the most recent crisis definitively demonstrated that in a globalized world, countries would need to work in a concerted manner to address problems and that they could no longer act unilaterally. “If we want to make sure globalization helps with global growth, we have to restructure international financial institutions,” he said, adding that the government now placed great importance in strengthening multilateral institutions. “Only then will they be more inclusive and fulfill their responsibilities more effectively.”

In calling for a more eclectic spirit to embody the institutions, he drew attention to the need of the bodies to encompass the voices of the protesters who were being kept well away from the summit, if the institutions were to receive the desired legitimacy.

“Everyone that steers the global economy, that means you, has to put their head between their two hands and contemplate carefully on where all these faults stemmed from. Also, we have to lend an ear to the ongoing protest outside this hall,” Erdoğan said.

The prime minister called on the global community to work together in making a major overhaul of the banking system in favor of regulation. “As the international community, one of the most important factors we can do is make the reform process successful,” he said. He cited a lack of regulation of the financial structure as being one of the principal causes of the crisis and said oversight of this sector would need to play an increasing part of this new emerging infrastructure. “Regulation lagged developments,” Erdoğan added.

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‘Immense change is imminent'

The new mandate of the Bretton Woods institutions -- and the IMF in particular -- could be most clearly detected in the words of IMF Managing Director Strauss-Kahn, who noted the “profound change” in the way in which nations interacted as demonstrated by the formal and informal cooperation among nations which he felt had helped avert a 1930s-like Great Depression. “In the face of crisis, countries came together to face common challenges with common solutions, focusing on the global common good.” He pointed to concerted efforts to implement stimuli around the world which resulted in nearly 2 percent of the world's gross domestic product (GDP) in 2008 and the profound effect this had on averting a 1930s-like Great Depression.

Echoing many of Erdoğan's words, Strauss-Kahn emphasized the fund's shifting focus to “multilateral surveillance.” “The IMFC [iMF Committee] endorsees the G-20 proposal for the IMF to help with their mutual assessment policies. This represents a new kind of multilateral surveillance for us -- and it fits well with our surveillance agenda, emphasizing macro-financial linkages and cross-country spillovers,” he said.

Strauss-Kahn said he thought “we have turned the corner,” and emphasized that “the global turnaround was no accident. It came about by unparalleled economic collaboration. “And now, we stand at a defining moment,” he said. “We know from history that when the nations of the world come together to address common challenges in a spirit of solidarity, we can attain a virtuous cycle of peace and prosperity and avoid a vicious cycle of conflict and stagnation.”

“We have come a long way, but the journey is not over,” he warned the audience. “Coming out of Sunday's meeting, the IMFC has asked us to address four key reform areas -- our mandate, our financing role, multilateral surveillance and governance.” He described the new mandate as the “Istanbul Decision.”

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But perhaps the most clearly articulated realization of the shifting power balances came from Zoellick, who, addressing the audience said: “The old order is gone. We should not waste our time and tears lamenting on it. Today we must build anew.” Later in the course of his speech he commented that “the Bretton Woods system was forged by 44 countries at a time when power was concentrated in a small number of states. The great waves of decolonization were just stirring; the few developing countries were seen as objects, not subjects, of history. That world is long past. The new realities of political economy demand a different system.”

He called on the G-20 to fulfill the function of a steering group with a broader membership, fostering mutual interests without hierarchical or bureaucratic constraints.

He warned, however, that we were still far from being able to declare a decisive victory over the crisis. Speaking at the inauguration of the annual meetings of the IMF and World Bank in İstanbul, Zoellick said that by the end of the year, 59 million additional people would be unemployed and 90 million more living in poverty in 2010.

http://www.todayszaman.com/tz-web/news-189...orld-order.html

Edited October 7, 2009 by Lone Ranger

[I AM NOT THAT GUY 5,715]

Where are the financial gurus? I would think this would be worthy of some comment. Matt? Scandal?