Brazilian President Lula Urges Action to Improve Global Finance Situation

Last Saturday Brazilian president Lula called for a complete overhaul of the world wide financial system which as he puts it, collapsed on nations like that of a house of cards due to the credit crisis. President Lula urges that Brazil and other emerging nations should have a bigger say and power in making decisions regarding the matter. This was backed up by concerns that countries such as theirs would really feel the credit crunch more than other established nations.

From Nonintervention Believer to Doubter

President Lula made it clear in his address to the finance officials as well as chiefs of many central banks around the world that his belief in the dogmatic faith of nonintervention of markets has been fully in question. This was especially true when bigger factors such as the United States and other countries were involved in the equation. President Lula of Brazil made it very clear that a new and more inclusive governance is the key to solving this problem. He adds that the nation of Brazil under his administration is ready and willing to exercise its fair share of responsibilities in an effort to form a solid pact with other governments from around the world. Only then, says Brazilian president Lula, can the world truly reshape the state of financial architecture for the better.

Meetings Put Brazilian Agenda to the Forefront

Because of his strong sentiments regarding the economic situation, finance ministers and governors of central banks have been meeting up in the economic hub of Brazil, Sau Paulo, to think of different ways that can address the global crisis. Jim Flaherty, finance minister of Canada, mentioned that he expected the central bankers to continue their discussions regarding joint actions on the interest rates. This would also counter the blows made to the credit crisis as well. Flaherty maintains that the discussions would eventually lead to coordination action which could thereby stimulate possible rate cuts in the region. He adds that the discussions are also key to finding out who and what bodies would be responsible for formulation and executing such plans as well. This also prompted the BRIC (or Brazil, Russia, India and China) to come together and forge joint positions regarding institutional reforms such as that of IMF in order to further put into the spotlight the plight of developing economies. This would hopefully give them the additional decisive power they are clamoring for.