G-5 seek restructuring of international financial architecture

Prime Minister Manmohan Singh with the leaders of G-5 countries, in L’Aquila, Italy on July 8

L'AQUILA, Italy: A summit of G-5 countries, including India, representing major emerging economies, decided to pursue their goal of immediate restructuring of international financial architecture, ensure greater credit for developing countries and to carry forward goals for climate change in favor of developing economies.

In a joint declaration at the end of their summit ahead of the G-8 meeting, leaders of India, Brazil, South Africa, China and Mexico, the current chair of the G-5, reaffirmed their commitment to pursue global solutions to the problems especially battling the current worst international economic crisis.

Reading out from the declaration, Mexican President Felipe Calderon said the new international architecture they see would allow balanced participation of developing counties in financial matters.

Prime Minister Manmohan Singh, in his remarks, said the developing countries have been the worst affected by the weakened global economy and the worst financial and economic crisis.

"We discussed how we could contribute to strengthening the green shoots of recovery. It is only through an inclusive approach that a collective global effort can be effective," he said. Singh said that at the G-8 summit G-5 leaders would stress the importance of maintaining adequate flow of finance to developing countries and also of keeping markets open by resisting protectionist pressures.

The developing countries were also the worst hit by high food prices. "We agreed that food and security need to be placed at the core of the international agenda," he said.
Singh said as responsible members of the international community they recognized their obligation to preserve the environment. But climate change cannot be addressed by perpetuating the poverty of developing countries, he said.

"The concept of sustainable development has so far been a buzz word. We need to evolve a strategy of growth that brings about a higher standard of living without harming the environment. Technology has to be the key element to our global strategy in dealing with the climate change. We will be hosting a conference on technology development and transfer in climate change in Delhi in October this year," he said.

The joint declaration on trade said the leaders were convinced that successful conclusion of the Doha Round of talks on the basis of its development mandate would provide a major stimulus to restoration of confidence in world markets and inhibit emerging protectionist trends which were particularly damaging to developing markets.

They said the Doha Development Round must deliver real and improved market access to developing countries' products and services and also ensure meaningful results where the greatest distortions lie, eliminating export subsidies and bringing down the massive trade-distorting subsidies in developed countries.

The objective must be to ensure that rule-based multilateral trading was fair, equitable and addressed the legitimate aspirations of developing countries.