G7 pushes for private sector help in crises
Thursday 22 April 1999
The move, signalled in separate speeches yesterday by Gordon Brown, the Chancellor of the Exchequer, and Robert Rubin, the US Treasury Secretary, is among a wide-ranging package of measures to reform the international system following last year's financial market crisis.
New codes of conduct in the provision of information by governments and a planned International Monetary Fund (IMF) credit line for countries in danger of falling victim to financial contagion will also get the go- ahead from the G7 next week.
The Chancellor said there must be a partnership between private lenders and public sector organisations in order to maintain confidence in crisis- hit countries. He will call for specific proposals for burden-sharing to be agreed by the end of this year.
"It is in the interest of the private sector that there be clear rules of the game which create the confidence that all investors will be treated equally and there is no advantage in being the first to get to the door," he said.
Mr Rubin laid less emphasis on a formal set of new arrangements, but said a "powerful programme" of reform was planned. He joined Mr Brown in saying bond contracts should contain majority clauses making co-ordination between lenders easier.
Mr Rubin added: "There is no reason why one category of unsecured private creditors should be regarded as inherently privileged relative to others .. Claims of bondholders should not be viewed as necessarily senior to claims of banks."
Mr Brown will also propose to other G7 ministers a new surveillance unit at the IMF to co-ordinate the data and information gathered by international institutions.
This would join the new financial stability forum, which co-ordinates the work of national and international bank financial market regulators and met in Washington for the first time last week.
Mr Brown and Clare Short, the international development minister, will be urging the G7 to speed up and extend the debt relief initiative for poor countries.
Ms Short will tell a conference in London tomorrow that the decisions taken next week will be "decisive" for the future of the world's poorest and most indebted nations. A new combined EU debt initiative is on the drawing board.
However, the G7 agenda is likely to be dominated by international financial reform. Mr Brown said yesterday that the fading of the crisis had not made reform less urgent. "There is no point in waiting for the next crisis before making the necessary reforms," he said.
His remarks were echoed by Michel Camdessus, managing director of the IMF. Speaking in Washington yesterday, he said: "The situation is better but there is no room for complacency."
- 1 Al Pacino on suffering from depression: 'It can last and it's terrifying'
- 2 Half of young women unable to ‘locate vagina’ and 65% find it difficult to say the word
- 3 Saudis risk new Muslim division with proposal to move Mohamed’s tomb
- 4 A teacher speaks out: 'I'm effectively being forced out of a career that I wanted to love'
- 5 Mexican woman becomes world’s 'oldest person' at 127
Perez Hilton apologises for publishing Jennifer Lawrence naked photo leak
Jennifer Lawrence 'nude photo hacker' claims there are hundreds more celebrity images to come
Victoria Justice on naked photo leak: 'Let me nip this in the bud right now – pun intended'
Saudis risk new Muslim division with proposal to move Mohamed’s tomb
Ariana Grande nude photos leak: Pictures are completely fake, say representatives
Rotherham child sex abuse scandal: Labour Home Office to be probed over what Tony Blair's government knew - and when
What do immigrants really think of Britain? Polish immigrant's Reddit post goes viral
Ashya King: Parents of five-year-old boy refused permission to visit him in hospital and denied bail at Spanish court
With Douglas Carswell joining Ukip, my party has taken another giant step forward
When elitism grips the top of British society to this extent, there is only one answer: abolish private schools
Ashya King: 'Cruel NHS has not given us the treatment we need', says father of five-year-old with brain tumour who fled to Spain
iJobs Money & Business
£30000 - £32000 per annum: Ashdown Group: HR Generalist (standalone) - Tunbrid...
£600 - £800 per day: Harrington Starr: Derivatives Risk Commodities Business A...
£600 - £800 per day: Harrington Starr: Power & Gas Business Analyst/Subject Ma...
£600 - £900 per day: Harrington Starr: Infrastructure Lead, (Trading infrastru...