Lula calls for clampdown on financial speculation

By AFP

July 15, 2010 Updated Jun 15, 2009 at 9:01 AM CDT

Brazilian President Luiz Inacio Lula da Silva called on Monday for an international clampdown on financial speculation and tax havens, during a summit on the impact of the economic crisis on jobs.

"We realise that this crisis demands a tougher attitude from workers, leaders and employers, we cannot live with tax havens," Lula told labour, employer and government representatives from 183 states at the International Labour Organization (ILO).

"We cannot afford to live with a financial system that speculates," he added, to loud applause.

The ILO has forecast that the financial and economic crisis could force between 39 million to 59 million people out of their jobs between 2007 and the end of 2009.

In a speech calling for a fairer and more equitable system to emerge with economic recovery, Lula insisted that the meltdown was triggered by the US subprime loans crisis and a "speculative financial web without precedent in the history of humanity."

French President Nicolas Sarkozy was also expected to outline his vision of the "social model" that he wants to see emerge from the crisis, in a speech to the jobs summit later Monday, French government officials said.

Sarkozy would call for economic, financial and social issues to be dealt with in equal measure and for a greater role for the ILO in the recovery efforts forged by the Group of 20 major economies, they added.

That would mirror the stance adopted by his Brazilian counterpart here.

Both France and Brazil are members of the G20, alongside major industrialised powers and emerging economies.

Earlier, Lula underlined his concerns about the broad impact of the global economic crisis in a separate speech to the UN Human Rights Council in the western Swiss city.

"As the leader of a developing country, I hope that a new international order that rewards production and not speculation will emerge from the crisis," Brazil's president told the Council's 47 member states on Monday.

ILO Director General Juan Somavia opened the meeting with an appeal for for urgent measures to save jobs.

"The world cannot afford to wait for employment to come back, several years after economic growth has returned," he told the summit, calling for "renewed leadership" at international level.

"We must urgently set in motion a process of much greater convergence and coherent cooperation among multilateral institutions," he added, calling for support for an ILO-sponsored global jobs pact.

Brazil's President Lula said the International Monetary Fund and the World Bank had been unable to offer "the slightest proposal" to tackle the meltdown, while the World Trade Organisation had been unable to reinvigorate global commerce.

The UN's labour agency, a tripartite organisation grouping governments, labour leaders and employers, sets and oversees international social standards.

But it has rarely had much political weight alongside international economic institutions or the G8 industrialised economies.

The G20 has served as a platform in recent months to coordinate global efforts to tackle the financial crisis and temper the impact of and economic recession in many countries in recent months.

It has focused so far on measures to prop up ailing banks and a clampdown on tax evasion, but critics say it has not done enough to prevent job losses or seek better social conditions.

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