Int'l community must reform global financial system:UN

United Nations, Oct 31 (PTI) United Nations has said that
the international community must fundamentally reform the
global financial system and help restore the trust lost as a
result of the greed and corruption that caused the current
economic crisis and untold suffering around the world.

The international financial crisis has once again brought
to the fore the issue of reforming these institutions in a way
that the developing countries have more say, U.N. General
Assembly President Miguel D'Escoto said.

D'Escoto was speaking at the inauguration of a high-level
task force – chaired by Joseph Stiglitz, winner of the Nobel
Prize for Economics in 2001 – to review the global financial
system.

The task force, members of which are being still
finalized, would give recommendations which could be discussed
in later meets considering the structural reform of the
international financial institutions.

"The international community has the responsibility and
the opportunity to identify longer-term measures that go
beyond protection of banks, stabilisation of credit markets
and reassurances for big investors," said D'Escoto.

"The stakes are too high for half-measures and quick
fixes put together behind closed doors," he added.

He noted that the global financial system does not
reflect the global and interdependent nature of the world's
economies and told U.N. member states that a solution to the
crisis must involve all countries in a democratic process.

"We must take advantage of the unique forum provided by
the United Nations to build agreement on the new financial
architecture required by the international community," he
said.

The response to the current turmoil affecting world
markets must also take into account the poor, said D'Escoto
while reminding member states to meet their commitments to
finance development despite the crisis.

"Sacrifices should be shared and cannot be placed on
the backs of the poor as is usually the case."

"All nations must be subject to financial discipline,
including the rich and powerful, or there will be no effective
international regulations," he added.

D'Escoto called for member states to "get down to
business" and identify actions that can lead to genuine change
so that the world economy can recover from the current crisis.

"The only realistic way to proceed from now on in our
world is to proceed democratically in an inclusive manner and
there is no better place to do that than here in the General
Assembly," he later told journalists at UN Headquarters.

He put together a panel of experts to review the
global financial system, including major bodies such as the
World Bank and the International Monetary Fund, and to guide
the world body in its deliberations concerning its response to
the financial meltdown.

The group is headed by Stiglitz of Columbia
University, and includes Prabhat Patnaik from the Center for
Economic Studies and Planning at Jawaharlal Nehru University
and Sakiko Fukuda-Parr of the New School University, who all
addressed the General Assembly in the morning session.

"The problem today in the financial markets is a lack
of credibility, and part of the problem of the lack of
credibility is a lack of legitimacy of the international
financial institutions because they don't have governing
structures that correspond to the 21st century,"Stiglitz said.

"In the weeks and months ahead, we must stay engaged
in the search for solutions that transcend narrowly defined
national interests. We must ensure that the changes that are
decided on truly serve the good of all our people (and)
nations, as well as our fragile planet."