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By Phil Stewart
3 Min Read
(adds Lula, Berlusconi news conference, background)
ROME, Nov 11 (Reuters) – Brazilian President Luiz Inacio Lula da Silva said on Tuesday he did not expect major results from the meeting of 20 nations in Washington to discuss the global financial crisis on Nov. 15.
“We still do not have the perfect diagnosis of the causes of the crisis and don’t expect much from this G20 meeting on Nov 15 in Washington,” Lula, who is acting president of the G20, said at a meeting of Italian unions in Rome.
“It will be the first meeting, it is the beginning, a promising start,” said the Brazilian leader.
Speaking at a news conference with Italian leader Silvio Berlusconi, who chairs the G8 next year and proposes turning it into a G13 or G14, Lula welcomed the fact that the G20 seems to be taking over as the main forum for tackling the crisis.
“We must use the crisis as an opportunity to correct things that were wrong before the crisis and strengthen multilateral bodies, because in a globalised world we need serious and representative forums to take global decisions,” said Lula.
“The G8 no longer provides this response and we need to have other countries and other continents for more democratic, more plural decisions,” he said.
Lula said that since each head of government would have just a few minutes to talk in Washington, the talks would only serve to “formulate proposals” on issues like “how will the financial system function and what sort of regulation will it have”.
Berlusconi agreed with Lula that not too much should be expected of the Washington gathering.
“It won’t provide a solution, but it is a first step to provide new regulation to finance and the economy, to prevent a repetition of the crisis,” said the Italian prime minister.
The two leaders’ sober stance dovetailed with comments by the International Monetary Fund Managing Director Dominique Strauss-Kahn, who said in a weekend newspaper interview that “expectations should not be oversold”.
Strauss-Kahn played down any prospect the meeting will lay the foundations for new financial governance, saying: “Things are not going to change overnight … A lot of people are talking about Bretton Woods II. The words sound nice but we are not going to create a new international treaty.”
Berlusconi said Italy will propose that banks getting state help should guarantee they will make the same amount of funds available to industry as they were lending prior to the crisis.
G20 government officials and central bankers agreed in Sao Paolo on Saturday that expansionary fiscal measures need to be taken to ward off the threat of a global recession. (Additional reporting by Gavin Jones and Stephen Brown, editing by Andy Bruce)
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