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Bush to host finance crisis summit

Published on 20/10/2008

Washington -- The United States will host the first of a series of emergency global summits on the financial crisis soon after US presidential elections on Nov. 4, US President George W. Bush and French President Nicolas Sarkozy said Saturday.

The announcement was made at the US presidential retreat, Camp David, outside Washington, where European Commission President Jose Manuel Barroso also joined the meeting.

Sarkozy, the current president of the European Union, and Barroso called for the building of a new financial order and new global capitalism system. Sarkozy denounced the failures in the American financial system that had led to the global crisis.

The expanded idea of a series of meetings was announced in a statement issued after the meeting. Earlier in the afternoon, Bush had declared his willingness to host one meeting.

The first summit will review steps being taken by the US and Europe to rescue the financial system, including banks and other financial entities, from being pulled down after the collapse of the housing bubble.

World leaders will also "seek agreement on principles of reform" needed to avoid another failure and "assure global prosperity in the future," the three men said in the statement. Subsequent summits would aim to "implement" specific steps.

As he welcomed Sarkozy and Barroso near the helicopter-landing pad at the retreat, in central Maryland, Bush said he looked forward to hosting the summit. "We’re dealing with a significant problem," he said.

Bush and Sarkozy emphasized their continuing support for free market economies and opposition to protectionism and isolationism.

It is "essential we preserve the foundation of democratic capitalism," Bush said. Sarkozy noted it would be "catastrophic" to close borders and "challenge the foundation of market economies."

Sarkozy has been pushing for such a conference for weeks, as the first waves of financial panic washed from the US across the Atlantic to European stock markets and banking systems.

"First and foremost, this is a worldwide crisis and we must find a worldwide solution," Sarkozy said, speaking English through a translator.

The French president indicated the meeting could take place in New York, since "this crisis began in New York, then the global solution must be found to this crisis in New York."

UN Secretary General Ban Ki-moon has offered to host the summit at the UN to lend "universal legitimacy" to the endeavor, the French daily Le Figaro reported, quoting a letter from Ban to Sarkozy.

Sarkozy, who thanked Bush for using his office "right up until the very end," said Europe wanted to work "hand in glove" with the US in building "the capitalism of the future."

He denounced hedge funds, tax havens and lack of supervisory control of financial institutions — three key elements in the US financial meltdown that has spread worldwide.

"This is no longer acceptable, this is no longer possible," the French president said. "This sort of capitalism is a betrayal of the sort of capitalism we believe in."

The goal of the emergency summit, Sarkozy noted, was to "speak with one and the same voice."

"We must make haste because we must stabilize the market place as swiftly as possible … Once calm has been restored, we must avoid at all costs that those who have led us to where we are today should be allowed to do so again," Sarkozy said.

Both Sarkozy and British Prime Minister Gordon Brown have called for the summit to be a "new Bretton Woods." In July 1944, an agreement was signed in Bretton Woods, New Hampshire, which established new rules for commercial and financial relations among the world’s major industrial states.

Sarkozy said EU leaders planned to go to Asia next week to discuss the crisis.

The G-20 finance ministers are planning to meet from Nov. 7-9 in Brazil but it was not clear if that meeting would be connected to the emergency finance summit. The G-20 includes the G8 countries (US, Canada, Italy, Germany, Britain, France, Japan, Russia) and Argentina, Australia, Brazil, China, India, Indonesia, Mexico, Saudi Arabia, South Africa, South Korea, Turkey and the European Union.

— Pat Reber/DPA/Expatica