UAE joins calls for financial bailout of Third World in economic crisis

A UAE government finance chief joins a chorus of delegates at UN headquarters to remind rich nations of their obligation.

NEW YORK // A UAE government finance chief joined a chorus of delegates at UN headquarters in calling on wealthy nations to bail out the developing world from the worst economic crisis in generations. Obaid Humaid al Tayer, Minister of State for Financial Affairs, was among leaders and envoys from more than 140 UN members at a finance summit in which poor countries had an opportunity to voice their concerns. Most western leaders stayed away, having dismissed the meeting as simply a platform for bashing capitalism.

Mr al Tayer called for an overhaul of "international financial, economic and trade systems" that would "promote global trade and investment" while also fostering growth in the developing world. He urged a response that "ensures the protection of millions in the developing and poor countries from poverty and hunger and strengthens the commitment of all stakeholders to fulfil their pledges on development and international security".

Mr al Tayer reminded rich nations of their obligation to provide 0.7 per cent of their GDP to nurture growth in the developing world. The UAE has already provided more than the target figure, he said without providing specifics, even though it has been hit hard by the global economic slump. "We succeeded in containing the crisis through a number of precautionary economic and financial measures that helped protect the national economy and reduce the impact of the crisis," he was due to tell delegates yesterday.

"Recent volatility in the markets strengthened the state's conviction and policies on the promotion and support of the manufacturing sector industries, the diversification and widening the bases of production." Mr al Tayer's call for aid was echoed by envoys from developing nations, with Dean Barrow, prime minister and finance minister of Belize, calling for an immediate "flow of resources to governments" to avert "further devastation".

Zimbabwe's vice president, Joice Mujuru, pleaded for a "financial stimulus package" for her country's devastated economy, saying lack of foreign support imperilled the recovery plan drawn up by the unity government. The UN secretary general, Ban Ki-moon, also called for more financial support to developing countries and chided the world's wealthy nations for reneging on pledges to boost aid to Africa.

"Surely if the world can mobilise more than US$18 trillion (Dh66 trillion) to keep the financial sector afloat, it can find more than US$18 billion to keep commitments to Africa," the UN chief said. A draft document set to be adopted by delegates today calls for increased aid and debt relief for poor nations, boosting representation of developing states at the International Monetary Fund and more supervision of hedge funds.

The three-day summit was organised by Miguel D'Escoto Brockmann of Nicaragua, the leftist president of the UN General Assembly, to ensure all 192 UN members had their say in reshaping global finances. It takes place two months after the London summit of the Group of 20 - the 19 countries and the EU - which together account for 85 per cent of the global economy. Even before it began, this week's summit was derided by diplomats from G20 nations as a "joke", a "tragedy" and a "waste of time".

Among the handful of world leaders who attended were Bolivia's president, Evo Morales, and his Ecuadorean counterpart, Rafael Correa. [e-mail]