World still in deep recession, says Secretary-General

Commonwealth Secretary-General Kamalesh Sharma has said the world is still in deep economic crisis, despite some signs of recovery in a few countries.

Speaking at the opening ceremony of this year’s Commonwealth Finance Ministers Meeting in Limassol, Cyprus, on 30 September, Mr Sharma noted that 2009 will see the first contraction of the global economy in the association’s 60-year history.

“It is wrong, to speak of the crisis in the past tense. The world is still deep in recession, and the residual effects will be all the worse, and all the longer-lasting, for the smaller, weaker, poorer countries, which do not have the cushion or the economic resilience to weather its storms,” the Secretary-General said.

He added: “No country in the Commonwealth will reach its growth potential this year.”

Citing the example of Botswana – which has been and remains a model of macroeconomic stability and careful liberalisation, Mr Sharma pointed to the fact that the country has seen a swing from a 7 per cent surplus in 2008 to a 6 per cent deficit in 2009. “I say this, simply to stress that the crisis has spared no one.”

He said because of the gravity of the situation, this year’s meeting which is focusing on sharing experiences on how each of the Commonwealth countries deals with and addresses the effects of the global economic crisis is very crucial.

“This is a particularly important meeting for finance ministers – in both your national capacities, and as members of the Commonwealth. Rarely, if ever, have the challenges facing finance ministers been more complex or grave.”

The Secretary-General highlighted that there are opportunities of drawing from the diversity of the Commonwealth to address the challenges facing the world today, including the economic crisis.

“The key is to make this Commonwealth diversity and inclusiveness a strength. To share experience, to learn from each other’s wisdom, to understand each others’ concerns, to act. I do believe that no other organisation offers quite this chance.”

He outlined key features of the shared Commonwealth approach to the issues confronting the meeting, including: commitment to collective engagement and to multilateralism; distinctiveness in pioneering new ideas; and partnership.

The opening ceremony was also addressed by the Finance Minister of Cyprus, Charilaos Stavrakis, who said that his country has tried to address the impact of the downturn by supporting key sectors of its economy, such as tourism and construction — which were more prone to the crisis.

Tanzania’s Finance Minister, Mustafa Haidi Mkulo, who also spoke at the session, said he hopes that by sharing experiences among each other, ministers will be able to distil good practice and explore ways of supporting one another.

Key Links:

• Economic Development
• Country Profile: Cyprus