UNITY and co-ordinated action towards a better engagement

G20 leaders must work together to end global economic crisis

By Barack Obama
Herald Sun

WE are living through a time of global economic challenges that cannot be met by half-measures or the isolated efforts of any nation.

The leaders of the G20 have a responsibility to take bold, comprehensive and co-ordinated action that not only jump-starts recovery, but also launches a new era of economic engagement to prevent a crisis like this ever happening again.

No one can deny the urgent need for action. A crisis in credit and confidence has swept across borders, with consequences for every corner of the world.

For the first time in a generation, the global economy is contracting and trade is shrinking. Trillions of dollars have been lost, banks have stopped lending, and tens of millions will lose their jobs across the globe.

If people in other countries cannot spend, markets dry up - already we've seen the biggest drop in American exports in nearly four decades, which has led directly to American job losses.

And if we continue to let financial institutions around the world act recklessly and irresponsibly, we will remain trapped in a cycle of bubble and bust. That is why the coming G20 summit in London is directly relevant to our recovery at home.

My message is clear: The US is ready to lead, and we call on our partners to join us with a sense of urgency and common purpose.

Our efforts must begin with swift action to stimulate growth. Already, the US has passed the American Recovery and Reinvestment Act - the most dramatic effort to jump-start job creation and lay a foundation for growth in a generation.

Other members of the G20 have pursued fiscal stimulus as well, and these efforts should be robust and sustained.

As we go forward, we should embrace a collective commitment to encourage open trade and investment, while resisting the protectionism that would deepen this crisis.

Second, we must restore the credit that businesses and consumers depend on. At home, we are working aggressively to stabilise our financial system.

Third, we have an economic, security and moral obligation to extend a hand to countries and people who face the greatest risk. If we turn our backs on them, the suffering caused by this crisis will be enlarged, and our own recovery will be delayed because markets for our goods will shrink further and more jobs will be lost.

We cannot settle for a return to the status quo. We must put an end to the reckless speculation and spending beyond our means; to the bad credit, over-leveraged banks and absence of oversight that condemns us to bubbles that inevitably burst.

I know that America bears our share of responsibility for the mess that we all face. But I also know that we need not choose between a chaotic and unforgiving capitalism and an oppressive government-run economy.

The nations of the world have a stake in one another. Together, we can learn the lessons of this crisis, and forge a prosperity that is enduring for the 21st century.

Barack Obama is President of the United States.