MercoPress. South Atlantic News Agency

Lula da Silva calls for new world economic order

The Brazilian president said it was time to end with “paper” speculation

Brazilian President Lula da Silva urged unions and workers on Monday to take advantage of the global financial crisis to help forge a new world economic order. He also criticized multilateral organizations for having no plans to address the current global crisis.

“I address myself now to the labour leaders” Lula da Silva told a global jobs summit at the International Labour Organization (ILO) in Geneva, Switzerland.

“This is an exceptional opportunity for all of you to think and develop proposals together with the employers and business leaders so that we can change definitely the relations between state and civil society and so that we can build our countries with much more fairness and much more solidarity,” he said.

Lula da Silva added that destabilizing surges last year in oil and commodity prices had been due to speculation.

“We cannot live with a financial system that speculates paper on top of paper without generating one single job, without manufacturing one screw, one shoe, one shirt, one tie” the former union leader told the conference to frequent applause.

“This economic crisis has opened an enormous perspective so that we can discuss everything, everything can be put on the table” he said.

The G20 group of rich and emerging countries, of which Brazil is a member, has asked the ILO to design policies to build a recovery from the crisis. ILO says it is important to avoid a lag in job creation as the economy recovers, because jobs and incomes will underpin the consumption needed as a foundation for sustainable growth.

Further on he said that “you’re witnesses that with the crisis for the eighties and nineties, when the World Bank and the IMF had all the solutions for the poor countries, but when the crisis hits the US, Japan and Europe, they don’t have the least proposal to address it”.

“The big banks and financial institutions had assessments and knew about the economic situation of countries in Latinamerica and Africa but they did not have five seconds to assess their own risks”, he added.

The crisis had exposed the falseness of “neo-liberal” doctrines calling for the state to be limited and everything to be left to the market, he said. Only the state had the power to bail out banks when the crisis hit, he said.

“It's only the state that has the guarantee and credibility to do what the markets did not manage to do,” he said.

Lula da Silva said he was disappointed that last year there was not sufficient consensus to conclude the Doha round of trade talks, which for eight years has been under discussion in an attempt to liberate trade.

“This would have helped reduce the huge government subventions of rich countries to their farmers and which constrict the production capacity of countries in Africa and Latinamerica”, underlined the Brazilian president.