It is humbling to
stand before this great Assembly today. Events of
recent weeks have proved beyond doubt that we are
now in a new global age. Living through the first
financial crisis and the first resources crisis of
globalization, we are a world not simply in transition,
but facing transformation, with change more far-
reaching than anything we have seen in our lifetimes.
The challenges, the opportunities for us and the risks
that we now face come together at the global
crossroads of the United Nations, providing the focus
for debate and decision here in this General Assembly
Hall.
A predecessor of mine said that if one built the
present only in the image of the past, one would miss
out entirely on the challenges of the future. It is to
those challenges of the future that I want to address my
remarks today.
In the next two decades, our world economy will
double in size. That means double the opportunities
and potential for more businesses, more jobs and more
prosperity. Extraordinary promise and opportunity
await, but there are also wholly new insecurities and
pressures — global problems that will require global
solutions.
The twin shocks of a global credit crunch and
soaring commodity prices lead straight to the front
doors of every family in every country, with higher oil,
gas and food prices, and higher costs for credit. But
because it is a global financial crisis and a global
shortage of food and resources, it will not be resolved
simply by individual nations acting in isolation,
although there is much that they can do themselves. It
will be solved in the end by us acting together.
I want to talk about how we can work together to
tackle financial instability and the intense pressure now
on our finite world resources. The immediate priority is
to help people everywhere cope with these difficult
times and to do so fairly. That is why, in Britain, we
have acted to help those hit hardest, assisting people
with the costs of gas and electricity, supporting
homeowners and the housing market and helping
people acquire the skills to do the new jobs of the
twenty-first century.
But if we have learned anything in the past few
years about the world in which we are now living, it is
that the world we share is more interconnected than
ever before and that the solutions have to be similarly
coordinated.
First, we must do all that it takes to stabilize the
still turbulent financial markets and, in the months
ahead, we must work together to rebuild the world
financial system around clear principles. In the short
term, each country is taking action to deal with the
fallout of the credit crunch, and the United States of
America deserves support from the rest of the world as
it seeks to agree on in detail what all parties agree on
in principle.
In Britain, we have taken decisive action to
promote stability in our banking system, protecting
depositors and introducing a temporary ban on short-
selling. We have already injected billions into the
market, making in excess of £100 billion available, and
announced only last week that our special liquidity
scheme will be extended until the end of January next
year.
Confidence in the future is also needed to build
confidence today, and that confidence will be built by
showing that what are global problems can be
addressed by globally coordinated solutions. I believe
there are five key principles behind that all nations
should unite around as we examine the future of our
financial system.
The first principle is that of transparency. People
must know what they are buying and selling, and they
must know what they are dealing with and not fear
what might be hidden on each other’s books. We must
look at the rapid introduction of improved
internationally acceptable accounting standards and
disclosure.
Secondly, there must be sound banking practice
and more effective regulation that looks not just at
solvency but at liquidity, at managing and pricing risks
for bad times and for good times, together.
Thirdly, there must be responsibility. No member
of senior management should be able to say he or she
did not understand the risks they were running and
walk away from his or her obligations.
Fourthly, there must be integrity. Most people
agree that companies should align reward with stability
and long-term gain because what matters is hard work,
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effort and enterprise. We should align the advice of
credit-rating agencies with the interests of the
investors.
Fifthly, just as banks are global and the flows of
capital are global, so oversight can no longer just be
national but must also include global supervision. That
is why we want to work to support immediately the
establishment of international colleges for each of the
largest global financial institutions — 30 of them by
the end of the year.
The international institutions built in the wake of
the Second World War have not kept pace with the
changing global economy. We need national regulators
to be cooperative, rules and principles to be consistent,
and international movements of capital to be
transparent.
The current era has been one of global prosperity.
It has also been an era of global turbulence, and while
there has been irresponsibility, we must now say
clearly that the age of irresponsibility must be ended.
We must now build that new global financial order,
founding it on transparency, not opacity; rewarding
success, not excess; and responsibility, not impunity.
That order must be global, not national.
Global action cannot be limited to financial
stability. We must also address another problem of
globalization — the global scramble for resources. We
need global action to deal with high commodity prices
and a rising global population demanding more energy.
Only by taking tough decisions on energy security and
climate change and by bringing together a new global
partnership of oil producers and oil consumers can we
bring stability to global energy markets and secure
sustainable energy supplies for the long term.
We are committed to tackling the global
challenge of climate change. Oil will of course
continue to meet a large part of our global energy
needs for some decades to come, but over the past year
we have seen the price of oil rise to as high as $146 per
barrel before falling again to $90 in the past month —
a fall of nearly 40 per cent. Such high and volatile
prices have a harmful impact on the global economy,
and all countries surely have a shared interest in
avoiding such dramatic swings in the price of scarce
resources.
We must now therefore consider whether the
current international architecture can bring the more
transparent and stable energy markets this global
economy clearly needs. We must bring producers and
consumers together, build common understanding and
address the issues through meaningful and sustained
dialogue. At the end of this year, I will be hosting a
global energy summit in London, building on the
momentum generated in Jeddah, Saudi Arabia, to agree
on key areas for further action. It is only by acting
together that we can make the most of the world’s
scarce resources and harness the power of our greater
interdependence for our common good.
Some say that in a time of difficulty we should
look inwards and cut aid; that we have an excuse for
walking by on the other side; and that, by our inaction,
we tolerate famine — but in today’s world, there is no
other side.
Africa is not part of the problem, but an
indisputable part of the solution. It is only by helping
Africa to become a net exporter of food rather than a
net importer that we can hope to achieve a long-term
end to soaring food prices. Only by restarting and
seeing the trade talks through can we help our
economies benefit from the annual boost of
$150 billion that would be achieved by removing the
protectionist trade barriers and trade-distorting
subsidies that currently cost developing countries the
most — $15 billion a year in their agricultural incomes
alone.
As Governments and as nations, we must respond
with courage and vision to the new insecurities that
face people, because while the global changes
happening all around us are complex, the instincts they
summon up in people are not. We must resist those
instincts that are protectionist. Now is not the time to
pull up the drawbridge, to seek solace in isolation or to
revert to an outdated and futile protectionism. It is only
by maintaining our open, flexible and dynamic
economies that we can best secure people’s jobs,
homes and standards of living in a global age.
Our global institutions have always had a
sweeping ambition, set up not against a single enemy
but against poverty, conflict, injustice and intolerance,
and set up in the belief that, for peace to last,
prosperity must be shared. Now we must build on the
idealism of the era that created those institutions and
change and evolve those institutions to meet the
challenges of the global age. This United Nations is
where the world turns to confront some of its greatest
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challenges. It is where international law is made, where
the most acute political problems are addressed, and
where the hopes of the world for a better future
ultimately rest.
For the past 40 years, it has been this United
Nations that has been the key forum where the
international community has sought peace in the
Middle East, and it is the United Nations that must help
the next Government of Israel build on the foundations
laid by Prime Minister Olmert and President Abbas to
agree to a two-State solution that guarantees the
security of Israel and gives the Palestinians a viable
State.
In Cyprus, where the United Nations has been
present for 30 years and more, we have a real chance of
a settlement, thanks to new leadership, which has our
support.
In Afghanistan, the International Security
Assistance Force is training Afghans to take back their
country after two generations of almost constant
conflict. When the Afghan Government can deny its
land to Al-Qaida and its associates, the international
community will have done its job, but the task is hard
and long. Progress is encouraging, but must be
continued and stepped up.
In the Sudan, United Nations peacekeepers help
keep the fragile North-South peace agreement in place,
but Darfur remains for all of us a disaster. It is the
responsibility of the Government of the Sudan to create
the conditions in Darfur that will allow the conflict to
end and a new deal for the people of Darfur to be put in
place. Justice has to be part of any sustainable peace.
Difficulty has never daunted the United Nations.
Where we are rebuffed, we are resolute, so we must
also send a powerful signal of our support for
democracy and human rights in Zimbabwe. We must
stand firm against oppression in Burma. We must, as
we did yesterday, reaffirm the practical measures that
underpin our determination to defeat poverty. Now
would be the worst time to turn our back on the
Millennium Development Goals.
We have reached a unique point in the world’s
history. For the first time in human history, we have the
opportunity to come together around a global covenant,
to reframe the international architecture to make it fit
for the challenges facing us in the twenty-first century,
and to build the first truly global society and global
citizenship. Our history is not our destiny, it is what we
choose to make it.
Let us resolve today to end any irresponsibility,
to protect the global public interest by cleaning up the
world’s financial system and to reaffirm our
commitment to meeting our global responsibilities on
trade, poverty, energy and climate change, and let us
act upon that as people, as Governments, as nations
united. Let history record that ours was a truly global
response to the first truly global crisis.