Meeting in the Chilean coastal resort of Vina del Mar in a pre-G20 warm-up, Brown, Lula, host Chilean President Michelle Bachelet and Spanish Prime Minister Jose Luis Rodriguez Zapatero said deep financial reforms were vital to avert a another financial meltdown.
“The whole world is paying the price for the collapse of a reckless venture of those that have turned the world economy into a gigantic casino,” Lula told fellow leaders in a roundtable discussion.
“We are rejecting blind faith in the markets.”
Brown said the G20 summit in London had to focus on concrete ways to revive growth and create jobs while protecting the environment and the world’s poor.
“We have got to be very clear that banking cannot be unsupervised any more; there’s got to be cross border supervision,” he said, calling for an overhaul of the system of international finance and coordinated policies to help underpin sustainable growth.
US President Barack Obama has called on fellow G20 leaders to agree on immediate action to help boost the struggling global economy, while Brown wants the group to back a $100 billion expansion of trade financing and agree upon a long-delayed global trade pact.
US Vice President Joe Biden told the meeting overlooking Chile’s Pacific coast the United States was eager to coordinate international policy to reduce systemic risk to global markets, but warned over-regulation could hurt healthy markets.
“We should not over-react. It is not a choice of markets or governments,” Biden said. “A free market still needs to be able to function.”
Thousands of people marched in Britain, France, Germany and Italy yesterday to protest the economic crisis and urge world leaders to act to reduce poverty, create jobs and avert climate change at the G20 summit.
“We have to democratize the economy, globalization and the financial system. How to do this? We already know: with information, transparency and responsibility,” Zapatero said.