"This is a global crisis and it requires a global response," said U.S. Secretary of the Treasury Tim Geithner. At the recent annual meeting of the Inter-American Development Bank's Board of Governors in Medelin, Colombia, Secretary Geithner said that now is a critical time for the Western Hemisphere and Inter-American Development Bank. He outlined 4 critical elements of an effective coordinated global response to the financial crisis.
"First, we need to make sure that we each commit to substantial and sustained macroeconomic policy support for demand, using all available tools," said Secretary Geithner. "Second, we need to reaffirm our commitment to maintain open policies toward international trade and investment and to avoid protectionist measures that could threaten recovery," he said.
A third critical element is the need to make sure the international institutions are able to deploy substantial resources quickly to help emerging and developing countries adjust to the sharp fall in global growth and the dramatic reversal in private capital flows.
Secretary Geithner said the fourth key element in a coordinated global response is building consensus on a strong set of reforms to the international financial architecture.
"Our markets are global and risk does not respect national borders," he noted. The United States supports needed reform of the governance of international financial institutions.
"The Inter-American Development bank will have to play a critical role in this global effort to confront the crisis," said Mr. Geithner. He said the U.S. encourages the IDB to further efforts to address the Western Hemisphere's demand for finance during 2009 and 2010.
"Part of this effort," he said, "must be directed at providing the poorest countries with crisis response tools." The United States, said Secretary Geithener, will work with the Inter American Development Bank to meet the economic challenges facing the Western Hemisphere and the world.