Some 160 members of parliament gathered in New York on 19 and 20 November to review the impact of the global response to the economic crisis following decisions taken in the past few months by the G20, the United Nations and the Bretton Woods institutions. The event, the Parliamentary Hearing, is a joint UN-IPU endeavour, designed to provide MPs with a unique opportunity to interact with high-level UN officials.
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The scorecard of the response measures taken thus far is mostly positive, the MPs found. But there are also several areas of concern both in terms of equity and of long-term impact. The global economic outlook remains uncertain and many imbalances and regulatory gaps will need to be corrected in order for governments to continue their difficult climb out of recession. The crisis should also occasion a re-thinking of fundamentals, such as the way well-being and development are measured (in terms of material accumulation) to instead consider more holistic approaches that also take into account the environment and the social dimension of economic life.
Among the concerns expressed, the most obvious was that the stimulus packages implemented around the world need to be better targeted at the poorest and most vulnerable. National responses also need to be better negotiated in a tripartite fashion (government, employees and the private sector) and must aim to strengthen safety nets both as a way of mitigating the effects of the crisis in many countries and of preventing new crises.
Participants noted that there are several long-standing commitments by developed countries, such as the elimination of duties and quotas on imports from least developed countries, which could provide more economic stimulus in the long-run than concessional loans. Several developing countries will, in fact, face a new debt crisis unless an international debt alleviation mechanism is set up as a matter of urgency.
A great deal of attention was also paid to the question of reforming the Bretton Woods institutions and their stewardship of the global economy. While acknowledging that important steps had been taken towards greater accountability and transparency, such as the World Bank’s new disclosure policy, it was far from clear that the commitment to increase the quotas of developing countries by a few percentage points (3% at the Bank, and 5% at the IMF) would be sufficient to make decision-making at these institutions more attuned to the needs of their "clients".
With regard to the financial industry, governments should do more to tighten regulation of products such as derivatives and prevent the recurrence of new speculative bubbles.
The full report of the hearing will be issued in a few weeks' time and circulated to UN Member States as a parliamentary input to on-going deliberations, including those of a new Working Group to follow up the UN Conference on the economic and financial crisis held in June this year.
