G20 - interview

G20 leaders take first steps to tackle global financial crisis

Article published on the 2009-04-02 Latest update 2009-04-03 08:57 TU

Heads of delegation pose for a family photo at the G20 summit in London on 2 April 2009.
(Photo: Reuters)

World leaders at London's G20 summit on Thursday began finalising the first measures of a rescue plan for the global economy. A draft summit communique also called for restrictions on bankers' salaries and measures to punish those who take short-term risks and on tax havens.

Participants were discussing ways to find hundreds of billions of dollars for the IMF and other delegations, diplomats said. The markets are watching closely what develops in the London meetings.

Economist Yan Toporovski told RFI the solution will require "not just regulation but a fundamental overhaul in the global financial system."

"It requires more than just regulation but financial reconstruction," he says.

"It's a crisis of the way in which markets work and therefore it's a crisis of free-market capitalism. If you look at the country's that have been least affeceted by the crisis you find they are countries where they do control their markets much, much more strongly."

Meanwhile in the London streets protests turned tragic when one man died. Police said bottles and other missles were hurled at them while trying to resuscitate the man.

An injured anti-G20 summit demonstrator, who later died, is taken to an ambulance in London on 1 April 2009.
(Photo: Reuters)

UN Secretary General Ban Ki-moon wrote an article in Britain's Guardian newspaper arguing that more than just economics is at stake in this year's G20, which has evolved into one of the most important summits in decades.

Unless decisive action is taken, the crisis could lead to "growing social unrest, weakened governments and angry publics who have lost all faith in their leaders and their own future", he wrote.

Despite the need for action, rifts "persisted" on how to draft new rules for international finance and stimulus measures, said UK Business Secretary Peter Mandelson.

China was believed to be blocking the tax haven measures, according to some diplomats, while France and Germany have continued their push for tougher regulation.

The United States, warned President Barack Obama, could no longer be relied on to be the "voracious consumer" driving worldwide growth.

"Make no mistake, we are facing the most severe economic crisis since World War II, and the global economy is now so fundamentally interlinked that we can only meet this challenge together," he said.