Just as the greedy fingers of the economic downturn reach the developing world, here comes the G-20 summit, next week in London. Right on time, a handful of leading voices are calling for a bold and well-considered response.
In a letter to world leaders, United Nations Secretary-General Ban Ki-moon urged G-20 to support a
for developing countries. That total would cover financing needs until the end of 2010, provide liquidity and prevent social unrest.
"We need a global response," said Nobel Prize-winning economist Joseph Stiglitz. "Except for one problem: many global countries do not have the resources needed."
Stiglitz was speaking March 26, on day two of the U.N.'s three-day dialogue on the "
." He urged industrialized nations to provide developing countries with substantial additional funding, and suggested 1 percent of stimulus funds – an increase from World Bank President Robert Zoellick's
– IMF issued funding and various regional financing schemes.
Stiglitz underscored one key condition. "Whatever is done needs to be done without conditionality."
, in a report prepared for the U.N. conference, suggested the answer was jobs.
"There is a risk that the development path will be seriously disrupted and in some cases reversed," said the report, which also warned of a prolonged labor market recession that would lead to social instability in developing countries.
ILO called for a global jobs pact that focuses on supporting smaller businesses, training workers for major infrastructure projects and creating small employment benefits packages, along with "promoting the rural and agricultural dimensions of the projects, which are crucial for developing countries as they would help boost domestic economic and job dynamism and attenuate the looming food crisis." Also important was global policy coherence to ensure that aid flows remain steady and work toward a green economy.
On that last point, the
has some ideas of its own. The British think tank recommended the creation of a low-carbon economy in some developing countries. Researchers believe sub-Saharan Africa offers excellent opportunities for
and Latin America should look more toward hydroelectric power.
Earlier this week, ODI released a report advising world leaders how to
in the developing world. It said developing countries are expected to lose incomes of at least $750 billion this year. The result will be rising unemployment, hunger, poverty and up to 90 million trapped in absolute poverty. The report outlined a development charter, which would include a global poverty alert system that would monitor the impact of declines in trade, remittances investment and incomes; better financial regulation and new financial rules that foster long-term growth; and spending of at least $50 billion in stimulus funding for Africa.
Those recommendations are much like
, which hinges on four steps: the global stimulus plan, rejection of protectionism and revival of the Doha round trade talks, the greening of the global economy and reform of global rules and institutions.
And not a minute too soon: Many have begun to complain that Ban had been too soft-spoken a U.N. secretary-general. Replacing the moral authority of Nobel Prize winner Kofi Annan was never going to be easy, but Ban has in his two years couched even his most urgent recommendations in subdued tones and gentlemanly diplomat-speak. This week,
called him "virtually inaudible on important questions of international security." His increasing outspokenness on the economic crisis is heartening.
Along with the valuable input of other knowledgeable observers, let's hope it's enough to win the hearts and minds of G-20 leaders. In London next week, nothing is assured – except perhaps