Global finance ministers kept searching for ways to tackle the unfolding financial crisis, turning their attention to its effects on rapidly developing countries and poor nations at risk of being swept up in the turmoil.
President George W. Bush and the world's financial leaders staged repeated displays of unity Saturday to combat an unfolding credit crisis, hoping to calm investors whose panic has spread despite bold and accelerating government action.
The crisis dominated discussions at the meeting of the Group of Seven industrialized nations and the annual sessions of the International Monetary Fund and World Bank. Many participants spoke in unusually somber tones of the need for action.
The talks shifted to the World Bank Sunday and its policy-setting committee led by Mexican Finance Minister Agustin Carstens and World Bank President Robert Zoellick, a former U.S. diplomat, trade negotiator and executive.
He said the financial events in developed countries could become a tipping point for many developing countries.
Zoellick said 28 countries are already fiscally vulnerable because of twin shocks of rising food and fuel prices. But they are unlikely to receive any increase in project aid and program aid from developed countries, which are tightening their own budgets because of the financial crisis.
"The poorest cannot be asked to pay the biggest price," Zoellick said. "For the poor, the costs of the crisis could be lifelong."
Bush pledged anew that his administration was doing everything possible to halt the biggest market disruption since the Great Depression of the 1930s.
Bush began his day with a White House meeting with finance ministers from the world's richest countries and then made an unexpected stop at an evening meeting three blocks away at the headquarters of the 185-nation IMF.
Accompanied by Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke, he participated for about 25 minutes in a discussion with the Group of 20, which includes rich nations as well as major developing countries such as China, Brazil and India.
Brazilian Finance Minister Guido Mantega said Bush told the finance ministers he was doing all he could to involve other countries in efforts to resolve the crisis.
Bush acknowledged the problems began in the United States, with a meltdown of the market for subprime mortgages in mid-2007, White House spokesman Tony Fratto said. But Bush felt it was important to take the rare step of going to such a meeting because the problems were spreading globally.
"It doesn't matter if you're a rich country or a poor country, a developed country or a developing country, we're all in this together," Fratto quoted Bush as saying. "We take this seriously, and we want to work with you."
In a joint statement the G-20 finance officials pledged to work together "to overcome the financial turmoil, and to deepen cooperation to improve the regulation, supervision and the overall functioning of the world's financial markets."
Other speakers at a policy meeting of the IMF echoed Bush in emphasizing the need for countries to work together to address the crisis, avoiding the go-it-alone protectionist trade strategies that worsened conditions during the 1930s.
"The depth and systemic nature of the crisis call for exceptional vigilance, coordination and readiness to take bold action," the IMF said in its joint statement. That statement, in an unusual move, repeated verbatim all of the commitments made in the G-7 statement Friday night. The G-7 groups the United States, Britain, Canada, France, Germany, Italy and Japan.
"There is a resolve in the international community hat this crisis will be resolved, that no tools will be spared to address its ramifications," said Youssef Boutros Ghali, Egypt's finance minister and the new chairman of the IMF's policy panel, the first from a developing country.
At his White House meeting, Bush said that in an interconnected world ,"no nation will gain by driving down the fortunes of another. "There have been moments of crisis in the past when powerful nations turned their energies against each other or soght to wall themselves off from the world. This time is different."
Fratto said Bush's commitment to collaborative action was repeated and agreed to by G-7 ministers and other officials who attended the White House meeting.
Bush did not mention any specific action that prompted his call. But Ireland ecently moved to guarantee all bank deposits, touching off similar actions in Germany and other countries concerned that nervous depositors would move their bank accounts to Ireland.
Bush barely noted in his remarks a significant new step for his administration - partial nationalization of banks. After daysof speculation this move was coming, Paulson announced late Friday that the government would take partial ownership in some American banks.
Officials in Europe prepared for a meeting Sunday of the leaders of the 15 countries using the euro currency. German Chancellor Angela Merkel and French President Nicolas Sarkozy said Saturday they opposed the creation of a common financial rescue fund for Europe.
Source: The Jakarta Post
President George W. Bush and the world's financial leaders staged repeated displays of unity Saturday to combat an unfolding credit crisis, hoping to calm investors whose panic has spread despite bold and accelerating government action.
The crisis dominated discussions at the meeting of the Group of Seven industrialized nations and the annual sessions of the International Monetary Fund and World Bank. Many participants spoke in unusually somber tones of the need for action.
The talks shifted to the World Bank Sunday and its policy-setting committee led by Mexican Finance Minister Agustin Carstens and World Bank President Robert Zoellick, a former U.S. diplomat, trade negotiator and executive.
He said the financial events in developed countries could become a tipping point for many developing countries.
Zoellick said 28 countries are already fiscally vulnerable because of twin shocks of rising food and fuel prices. But they are unlikely to receive any increase in project aid and program aid from developed countries, which are tightening their own budgets because of the financial crisis.
"The poorest cannot be asked to pay the biggest price," Zoellick said. "For the poor, the costs of the crisis could be lifelong."
Bush pledged anew that his administration was doing everything possible to halt the biggest market disruption since the Great Depression of the 1930s.
Bush began his day with a White House meeting with finance ministers from the world's richest countries and then made an unexpected stop at an evening meeting three blocks away at the headquarters of the 185-nation IMF.
Accompanied by Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke, he participated for about 25 minutes in a discussion with the Group of 20, which includes rich nations as well as major developing countries such as China, Brazil and India.
Brazilian Finance Minister Guido Mantega said Bush told the finance ministers he was doing all he could to involve other countries in efforts to resolve the crisis.
Bush acknowledged the problems began in the United States, with a meltdown of the market for subprime mortgages in mid-2007, White House spokesman Tony Fratto said. But Bush felt it was important to take the rare step of going to such a meeting because the problems were spreading globally.
"It doesn't matter if you're a rich country or a poor country, a developed country or a developing country, we're all in this together," Fratto quoted Bush as saying. "We take this seriously, and we want to work with you."
In a joint statement the G-20 finance officials pledged to work together "to overcome the financial turmoil, and to deepen cooperation to improve the regulation, supervision and the overall functioning of the world's financial markets."
Other speakers at a policy meeting of the IMF echoed Bush in emphasizing the need for countries to work together to address the crisis, avoiding the go-it-alone protectionist trade strategies that worsened conditions during the 1930s.
"The depth and systemic nature of the crisis call for exceptional vigilance, coordination and readiness to take bold action," the IMF said in its joint statement. That statement, in an unusual move, repeated verbatim all of the commitments made in the G-7 statement Friday night. The G-7 groups the United States, Britain, Canada, France, Germany, Italy and Japan.
"There is a resolve in the international community hat this crisis will be resolved, that no tools will be spared to address its ramifications," said Youssef Boutros Ghali, Egypt's finance minister and the new chairman of the IMF's policy panel, the first from a developing country.
At his White House meeting, Bush said that in an interconnected world ,"no nation will gain by driving down the fortunes of another. "There have been moments of crisis in the past when powerful nations turned their energies against each other or soght to wall themselves off from the world. This time is different."
Fratto said Bush's commitment to collaborative action was repeated and agreed to by G-7 ministers and other officials who attended the White House meeting.
Bush did not mention any specific action that prompted his call. But Ireland ecently moved to guarantee all bank deposits, touching off similar actions in Germany and other countries concerned that nervous depositors would move their bank accounts to Ireland.
Bush barely noted in his remarks a significant new step for his administration - partial nationalization of banks. After daysof speculation this move was coming, Paulson announced late Friday that the government would take partial ownership in some American banks.
Officials in Europe prepared for a meeting Sunday of the leaders of the 15 countries using the euro currency. German Chancellor Angela Merkel and French President Nicolas Sarkozy said Saturday they opposed the creation of a common financial rescue fund for Europe.
Source: The Jakarta Post
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