Prime Minister Manmohan Singh today said a key outcome of the emergency summit on financial markets and the world economy, held in Washington on November 15, was the recognition that the balance of power has shifted in favour of emerging economies.
“Before, our views were not taken into account when the G8 held meetings. But this time, there was genuine dialogue between the developed countries and the major emerging economies,” the prime minister said, adding, “The western world has at long last got to realise this reality.”
A communiqué issued after the summit expressed the need to advance the reform of the Bretton Woods institutions, the World Bank and the International Monetary Fund, so that they adequately reflect the changing economic weights in the world economy.
The communiqué also resolved not to raise trade barriers in the next 12 months, and accelerating the Doha process as soon as possible.
“Emerging and developing economies, including the poorest countries, should have a greater voice and representation,” the statement said. The statement also spoke of expanding the Financial Stability Forum to broader membership of emerging economies.
Describing the meeting as “very successful”, the PM said there was no attempt to score “partisan points”.
“When President Bush first spoke to me about this idea I had mentioned to him that if the meeting was not well prepared, it would be counterproductive. Also, I was worried that the Americans and Europeans may not be able to agree,” Singh said.
“There was recognition that the world was facing a threat that would spill over into the real economy and that developing countries were the worst sufferers,” he added.
The PM pointed out that the developing economies had recognised the importance of not losing sight of the Millennium Development Goals to eradicate poverty.
Manmohan said there was complete agreement on the need for fiscal stimulus to make good the deficiency in private demand.
“For a meeting which was convened at a short notice, I must say it was well prepared. The Chinese, the Russians, they all said they could endorse it and I think this is a positive feature of the outcome of the meeting,” the PM said.
