International Cooperation Needed in Face of Financial Crisis

  • 8 October 2008

The world is facing a serious financial crisis that many economists believe is similar to the Great Depression that struck the world in the 1930s. The consequences of this crisis would not be limited merely to the economic sphere but would also assume humanitarian and social dimensions. The International Monetary Fund (IMF) recently warned of the humanitarian impact of the problemincluding famines, epidemics and other calamities in many countries, especially those in Africa and Latin America.

The solution of this international crisis necessitates concerted global efforts for the formulation of effective strategic plans, in addition to greater coordination and exchange of information and expertise. This crisis is so huge that no country, irrespective of its economic strength or capabilities, can confront it alone, especially in our highly integrated and globalized world.

The measures adopted to confront this global financial crisis would determine its extent of impact and its amount of damage to the international economy. All indicators suggest that the world is passing through a very crucial period, and the steps taken for addressing this crisis would determine the future of the world and the fate of future generation. Therefore, it is important that any measure taken to solve this crisis should be taken only after comprehensive international deliberations and in an atmosphere of cooperation, as well as in keeping with the level of existing risks. Additionally, it is important for the concerned international economic organizations to play their part and jointly coordinate their actions after establishing broad and effective strategies for solving the crisis.

The destructive impact of the financial crisis is merely a pointer to the greater risks that lie ahead, as what has occurred till date is said to be just the tip of the iceberg. The enormity of the problem should galvanize international cooperation against any catastrophic escalation, as the crisis relates to the daily lives of people. Consequently, an economic meltdown would have debilitating effect on social, security and political stability around the world.

International cooperation is desperately needed to confront the current financial crisis, and so is regional cooperation. In this respect, coordination at the level of Arab States and the GCCespecially in monitoring and studying the impact of this crisisis the need of the hour for building immunity against the challenge and for avoiding escalation of the problem for GCC economies in the near future. These economies need to be protected as they are open and susceptible to the vagaries of the international economy. Moreover, these economies have made significant progress in recent times that underscores the importance of their protection against any international economic downturn.

In such times of global financial turmoil, it is pointless to contend and debate over the causes and reasons for the present crisis, or to waste time on the feasibility of capitalist ideal itself. It is time to act seriously and expeditiously and to collectively rescue the world from the fast escalating crisis.