Source:
Latindadd
Sun Oct 04 2009
Since April this year, the Group of 20 has tried to consolidate themselves as the authorized discussion forum for responding to the Global Crisis. Also, the IMF has geared up to place loans to the entire world, (i.e. the countries in the north, the places of origin of the crisis, which persist in maintaining their hegemony in spite of being the most indebted economy, to the detriment of the peoples in the south who find themselves affected by the developed world bank financing carrousel and the extraction of natural resources.
In the face of this reality LATINDADD considers:
1. The world political leaders have not declared the will to prevent world prices from being defined by speculation. The tax-havens continue to operate and so far the bankers responsible for the worst global economic crisis in recent years have not paid for their irresponsibility.
2. The G20 and IMF along with international financing institutions pretend to make the changes that they are required to make to the economic model, by providing misleading recovery indicators based on the same speculative zeal that brought the economic model down.
3. In the period of transition that the global economy has been going through since September 15 with the fall of Lehmman Brothers, it us obvious that changes will not result from political agreements, but be marked by new economic events. In this sense, the United Nations organisation constitutes the most comprehensive and representative forum to find a way out of the global crisis, considering the most excluded and poorest populations on the planet.
4. Although, the organizations of global debtors, for years, have been demanding a new financial architecture, the auditing of the debts, and the rejection of all acts of corruption, and abuse in the management of global finance, the G20 has claimed for itself the authority to lead the discussion on a new international financial architecture that does not even take into consideration the progress made in the United Nations Conference on the World Financial and Economic Crisis and its Impact on Development, and to a lesser level the civil society contribution. They are threatening the opportunity to create a new financial architecture responding to our people’s Well-Being.
5. The world’s discussion is influenced by the prejudice of financial regulations and does not consider the billions of people impacted. Just look at the majority of countries in the south, in Latin America for example, that are facing huge tax challenges from the fall of external demand that, in the majority of cases, was an option imposed when we were forced to let go of the industrialization processes suppressing our economies. The public budget for social sectors is directly impacted by this fall in tax collection, forcing us to again appeal to a vicious circle of external debt, from which many countries have not yet gotten out.
6. In spite of the fact that the IMF is not representative and it has not been capable of exercising appropriate supervisory duties to prevent the crisis, it has now returned with the same ideology of tax adjustments and open trading, i.e. the same fundamentals in a world seeking new paradigms for economic, social and environmental development. They continue using the Special Drawing Rights mechanism – SDR which presents issues of access and legitimacy.
7. The G20 proposal for a “more equitable” distribution directing 5% of the votes to emerging countries does not yet guarantee a more equitable participation for our countries.
8. The progress in the international debate’s speeches on more supervision, more regulations and the modification of financing rules are only an illusion since they have not been implemented and the derivates markets continue to be totally unconnected to work production.
Therefore, LATINDADD demands:
1. The countries in the south should enter into a moratorium of their debt during 2010, so they can address their social and productive sectors such as: internal agriculture, education, health, and social safety; and finance Well Living for the people. IMF could also donate the SDR to the countries in the south.
2. The transactions to address multiple issues raised by the crisis must be transparent and condition-free as a repair to the damages caused.
3. Performance of internal-external debt audits, and audits of the international financial institutions as well.
4. The enforcement of a clause of equity and shared principles of responsibility on new debts in building the legal structure as proposed by the Responsible and Sovereign, Democratic Financing Platform stating:
∙ The countries commit to grant loans to be used on sustainable development projects, safeguarding human rights.
∙ The countries commit to respect the sovereign right of the countries to determine their development policies.
∙ The obligation of the payment of debt must not prevent the countries from providing for their social responsibilities to their citizens.
∙ The transactions must be transparent and the agreements made available for public knowledge, for any type of screening.
∙ That the green debt, of which we are the creditors, and which is generated by the countries in the north, be made visible.
5. An international financing regulation that is broader and improved, and an effective multilateral supervision, in order that the following will take place: Expansion of the scope of the regulation and supervision of the financing institutions and instruments through a new multilateral financing mechanism; promotion of a coordinated tax law, currency and exchange rate policies between the countries that achieve an integration of regional financing and establishment of international regulations to limit the volatility of foreign capital inflows to prevent the national financing system from being affected by them
6. An equitable redistribution of Latin America resources based on Tax Justice. In order to accomplish this it is indispensable to: review the free trading, protection and investment agreements; increase the tax burden on wealthier sectors in such a manner as to revert the increase in tax revenue to the neediest social sectors; promote fiscal reform focused on establishing a higher tax rate to be applied to those who earn more, reducing indirect tax; eliminating the tax havens and tax privileges granted to direct foreign investment.
7. A new payment system and international reserves which reduce dependency on the dollar and end intra-regional trading distortions and global pricing. The current global reserve system must be replaced with a new reserve system based on a basket of national currencies with the participation of countries around the world. This could start being applied to the Special Drawing Rights – SDR. This new system is complementary with other regional agreements, such as Unified System for Regional Compensation SUCRE which is a proposed regional currency for the Bolivarian Alliance for the People of Our America (ALBA)
8. A new regional financing architecture that tends to reduce the participation of the current international financing institutions in local politics, promote the reform of the governance system to lead to financing institutions and development banks, such as Bank of the South, which are more democratic, representative and free of conditions, and generate a United South American Currency (Unidad Monetaria Sudamericana -UMS)
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