Local view for "http://purl.org/linkedpolitics/eu/plenary/2009-04-23-Speech-4-339"
| Predicate | Value (sorted: default) |
|---|---|
| rdf:type | |
| dcterms:Date | |
| dcterms:Is Part Of | |
| dcterms:Language | |
| lpv:document identification number |
"en.20090423.62.4-339"2
|
| lpv:hasSubsequent | |
| lpv:speaker | |
| lpv:translated text |
".
Mr President, ladies and gentlemen, on 2 April 2009 the meeting of the G20 heads of state and government was held in London to discuss further steps towards the recovery of the global economy and the prevention of future crises on such a scale. At their meeting the heads of state and government promised to do everything necessary to restore confidence, economic growth and employment, to amend the financial system in order to renew credit flows, to strengthen financial regulation, to restore confidence to the market and to fund and reform our international financial institutions in order to enable them to provide effective help in tackling this crisis and to prevent future crises. At the same time the heads of state and government made a commitment that in the interests of boosting prosperity they would promote global trade and investment and reject protectionism and that they would prepare the economy for inclusive, environmentally-friendly and sustainable growth and recovery.
Thirdly, the heads of state and government achieved consensus over matters where consensus seemed almost inconceivable just a year ago or even nine months ago. The commitments from London capped off three months of intensive discussions at a working level and they marked a real breakthrough. If they are fulfilled and put into practice then they will definitely provide a good basis for prevention so that we can avoid similarly destructive crises recurring over the coming decades.
Fourthly, the summit changed the shape of the space for global economic cooperation, leading to a new division of powers. The largest newly-emerging economies achieved full recognition of their role in the global economy. The developed countries and the rapidly developing economies also jointly acknowledged that the stability and prosperity of poor countries and the most vulnerable social groups everywhere in the world are in the interests of everyone. This marks a strategically significant change. It means that Europe will have to fight with a new vision and with sophisticated policies in order to retain its position in global economic decision-making. The size of the EU economy and the inheritance of the past will not in themselves suffice to maintain Europe’s important strategic role in global economic decision-making in the future.
Nevertheless, from an EU perspective the results of the London summit were an undoubted success. The summit backed all the priorities agreed to by EU Member State leaders in the conclusions of the European Council of 19-20 March 2009. The London G20 summit rejected protectionism, made a commitment to a responsible and sustainable economic policy, supported multilateralism and backed all the priorities concerning financial sector regulation which EU Member States have collectively identified as fundamental. As has already been said, EU members were the prime movers or among the prime movers in the G20 negotiations over a range of issues. However, a number of questions remain open after the G20 summit.
Firstly, in the area of financial regulation and supervision, despite the enormous progress in recent months, a number of issues remain unresolved and are still being worked on. At the EU level, of course, there is a clear roadmap and timetable for the next two months and a division of roles between the European Commission, the European Central Bank, the European Financial Commission, ECOFIN and the June European Council. The programme includes, among other things, the immediate task of taking strong measures in the area of accounting standards that would enable European banks to operate under comparable competitive conditions to those of American banks.
Secondly, in the area of global trade the G20 leaders confirmed in London their earlier commitment from the Washington meeting not to create new trade barriers. The G20 summit also confirmed the commitment to complete the Doha Development Agenda “with an ambitious and balanced outcome”. However, this commitment had already been adopted at the G20 summit in November last year, where the heads of state and government even promised agreement over the Doha Development Agenda by the end of 2008. It therefore remains to be seen how serious the commitment is this time. Nevertheless the G20 leaders in London made a fresh declaration that from now on they would give their personal attention to the Doha Development Agenda and they guaranteed that political attention would be focused on Doha at all forthcoming international meetings that are relevant from this perspective. It must be one of the key priorities of the EU to press for the completion of these agreements.
Thirdly, the G20 summit participants made a commitment to provide USD 1.1 trillion through the IMF and multilateral development banks to help restore credit flows, economic growth and employment in the world economy. All that remains is to clarify and agree on the details of this commitment. The commitment covers short-term, medium-term and long-term stages and the short-term stage includes the EUR 75 billion promised to the IMF by EU countries for restoring balance of payment stability for countries in acute need of such assistance. The details of this commitment also remain to be worked out and the finance ministers of our countries must work on the form and mechanisms of this commitment.
Concerning the medium and long-term commitments to strengthen multilateral institutions, there is a commitment to provide the IMF with an unprecedentedly large multilateral loan of USD 500 billion. Besides this, the London summit produced a commitment that the G20 countries would support a new SDR (special drawdown rights) issue, in other words an issue in the IMF’s own currency which can be used by IMF member states for mutual payments. The commitment speaks of SDR 250 billion. Like multilateral credit, an SDR issue involves relatively complex technical arrangements, including approvals from official IMF bodies, negotiations with participating countries and ratification of agreements by the national parliaments of member countries. All of this could take several years and it is therefore necessary to remain firm but realistic in our expectations.
The above commitments also involved an agreement that the G20 countries would do everything in their power to ensure rapid implementation of the April 2008 reforms to IMF decision-making structures, which are currently delayed by slow ratification in national parliaments. The G20 countries also asked the IMF to speed up the next round of reform in member shares and voting rights so that it is ready by January 2011. The EU countries must pay sufficient attention to this forthcoming reform because it may result in many EU Member States, large and small, losing the possibility of their national representatives participating directly and indirectly in IMF decision-making and losing direct access to information. There will also be reform aimed at strengthening the role of the IMF in global economic decision-making. For many EU Member States this issue has so far been of little interest but their attention must remain firmly focused on it in the coming months.
Fourthly, there is one remaining area requiring serious and careful discussion and a solution. This is the area of global inequality and the question of the whole global currency system in the future. These issues were deliberately excluded from the London summit agenda and as such they remain on the list of areas to be dealt with in the future. It is worth mentioning in this context that it was precisely the inability to agree on a global currency order which scuppered the London summit of 1933. This issue is no simpler today than it was then. The EU must devote an appropriate amount of attention to it, because a solution to this issue remains an important ingredient for sustainable economic recovery and for preventing devastating global crises.
Ladies and gentlemen, in conclusion I would like to thank Great Britain, the country hosting the G20 presidency, for organising the summit and above all for organising the entire process of discussion and negotiation at a working level in the weeks and months leading up to the summit. The organisers did an excellent job and they deserve our applause since they made a significant contribution to the progress achieved and to the breadth of the final consensus.
The EU played a very significant role through its proposals and attitudes. In many areas, if not in the most, the EU and the European members of the G20 were the prime movers, or among the prime movers, of the work in the preparatory groups and they significantly influenced the breadth of the agreed consensus and the final form of the agreed proposals. This applied to the areas of financial market regulation and supervision, complete transparency in the financial system, the rejection of protectionism, the pressure to complete the Doha Development Agenda and the approach to economic recovery including the emphasis on the need to clear out the financial sector by removing worthless assets and creating a basis for a sustainable global economy in the future. Last but not least was the commitment of the EU countries to provide a financial injection to the IMF, which not only influenced the willingness of other countries to take on similar commitments, but above all played an important if not key role in the decision to stabilise economies that were unable to help themselves. This is to be done not through
solutions and bilateral assistance but through systematic use of the international institutions that exist for this purpose. In this way we will strengthen these institutions financially and also restore their respect and authority.
There is hope that the London G20 summit will usher in a new and successful era of global economic cooperation. I firmly believe that it has a decent chance. The conclusions of the G20 summit are an excellent starting point for bringing the global economic crisis to an end as quickly as possible. An opportunity has also opened up to change the shape of the future interconnected global economy in order to be better prepared for long-term sustainable production and coordinated economic decision-making. Much unfinished business remains and there are many commitments that have to be fulfilled. The coming months and years will show to what extent the London summit merits a place in the history books. In any case, the G20 summit marked a shift of strategic positions in the global economy. It is important for the EU to enter this new era with a clear and realistic vision and with policies that will ensure that Europe retains the same strategic role in the future as it has enjoyed in the past and which its 500 million citizens deserve.
I would therefore like to take a look from a distance at what the London G20 Summit might mean for the world economy and for the EU in particular.
I will begin with a flashback to the year 1933. In June 1933 representatives from 66 countries met in London in order to try to create a common plan to restore the world economy in the middle of a great economic crisis. The London Monetary and Economic Conference, which had the objective of reviving global trade, stabilising prices and restoring the gold standard as the basis of the monetary system, was organised by the League of Nations and met under a similar global economic situation to the one we are experiencing today. Within a month, however, the conference ended in failure with a subsequent loss of confidence, further economic collapse and a chain of currency devaluations through which countries sought to strengthen their own economies at the expense of others. European states turned in on themselves and the US economy retreated into an isolationism which would last for many years. As the recession turned into a deep depression, unemployment and social tension grew and the political consequences of the tension led to the Second World War. In the weeks leading up to the London summit of 2009 it was hard not to recall the parallels with the London summit of 1933. Fortunately it seems that the world has learned from its experience, at least for now.
After many months of frustrated hopes and expectations, low confidence in the markets and deepening recession it was almost a political imperative for the G20 summit to end in success. It was a task of nightmare difficulty in view of the widely varying expectations of the different groups and countries and in view of the fact that some of these expectations were not entirely realistic. Ladies and gentlemen, it is too soon to say whether the G20 meeting was a success. Nevertheless, the weeks that have passed since the summit give grounds for cautious optimism that it really was a turning point in this global recession and that it may also become a key historical event in global economic cooperation. It may even stand the test of time and be accorded similar historical importance to the Bretton Woods Conference of 1944, which determined the shape of global economic cooperation for a quarter of a century and continues to influence it even after 60 years.
However, the historical importance of the ideas put forward at the G20 summit will become clear only when all commitments from the summit have been fulfilled, if indeed they ever are fulfilled. Despite this necessary circumspection there are four reasons why the London G20 meeting can be regarded as a successful start to economic recovery and to a new and more sustainable form of global economy and global economic decision-making.
The first reason is that the G20 really did boost confidence in the economy and in the markets. So far the increase in confidence has not been dramatic but a full return of confidence will naturally take time. The most important thing from the perspective of boosting confidence was the way the G20 participants behaved. Faced with a profound global collapse they maintained unity and they reached a broad consensus.
In the current period of uncertainty it was also vitally important that the G20 participants confirmed some of the fundamental economic paradigms: the core or the heart of our global recovery plan must be the jobs, needs and interests of people who are not afraid to work, and this applies across the whole world, not only in the rich countries but also in the poor countries. At the heart of our global recovery plan must be the needs and interests not only of people alive today but also of future generations. Recovery must not be at the expense of our children and grandchildren. The only reliable basis for sustainable globalisation and growing prosperity is an open world economy build on market principles, effective regulation and strong global institutions.
Secondly, the G20 summit sent a very strong signal – clearly the strongest in 60 years – that the world was returning to multilateralism in economic decision-making on matters of global consequence. In the summit conclusions the heads of state and government reaffirmed their conviction that prosperity is indivisible and that if economic growth is to be sustained then countries must share in that growth. If there is one lesson to be taken from the current global crisis, it is that we all share the same fate in economic terms. We are all in the same boat, large and small countries, open countries and closed-off countries. The interconnectedness of our economies has brought enormous benefits, particularly over the past 10-15 years, in the form of a long period free of major conflicts and in the form of unprecedented economic prosperity and the fastest global economic growth in human history, as well as opportunities for hundreds of millions of people to escape from extreme poverty. It has brought an expansion of markets for our producers, low inflation and low unemployment. We must not give up these advantages at any price. It is therefore absolutely essential to coordinate our policies, both in good times and in bad, and the G20 summit confirmed this fact."@en1
|
| lpv:unclassifiedMetadata | |
| lpv:videoURI |
Named graphs describing this resource:
The resource appears as object in 2 triples