Manmohan cautions against building walls of protectionism

United Nations, Sep 24: Noting that the world economy is in trouble, Prime Minister Manmohan Singh Saturday cautioned against allowing the slowdown to trigger the building of walls of protectionism and checking free movement of people, services and capital.

‘Effective ways and means must be deployed to promote coordination of macro economic policies of major economies,’ he said while calling for the reform of governance systems with speed and efficiency in his address to the United Nations General Assembly.

‘The world economy is in trouble,’ Manmohan Singh said noting ‘The shoots of recovery which were visible after the economic and financial crisis of 2008 have yet to blossom. In many respects the crisis has deepened even further.’

With the traditional engines of the global economy such as the US, Europe and Japan faced with continued economic slowdown and recessionary trends, developing countries too face a negative impact besides bearing the burden of inflationary pressures.

‘Declining global demand and availability of capital, increasing barriers to free trade and mounting debt pose a threat to the international monetary and financial system,’ he said, adding, ‘Questions are being asked about the efficacy of the Bretton Woods institutions.’

But Manmohan Singh said the global economic slowdown should not be allowed to ‘become a trigger for building walls around ourselves through protectionism or erecting barriers to movement of people, services and capital’.

Instead ‘effective ways and means must be deployed to promote coordination of macro economic policies of major economies’, he said suggesting ‘the reform of governance systems of international financial institutions ought to be pursued with speed and efficiency’.

(Arun Kumar can be contacted at arun.kumar@ians.in)

IANS