In These New Times

A new paradigm for a post-imperial world

Brown confident of Middle East cash for bail-out fund

Posted by seumasach on November 3, 2008

 

So now we know exactly what Brown has in mind as regards his “new Bretton Woods”: a bailout fund for the IMF so that it can continue its work of destroying the real economy globally. Brown knows the UK and US are going down- the point is to make sure everyone else does too. It’s a kind of scorched earth policy. It’s hardly surprising that China and the Arab countries have reservations about this: let’s hope they all have the sense to block this at the G20 conference on 15th November.

Allegra Stratton

Guardian

3rd November, 2008

Gordon Brown yesterday said he felt confident that he has successfully enlisted the help of Gulf states for international plans for an emergency bail-out fund, with both Qatar and Saudi Arabia indicating they will offer funds when leaders of the 20 most developed countries meet in Washington in a fortnight.

As the prime minister arrived in Qatar on the second leg of his whistlestop Gulf tour last night, the Qataris hinted they would contribute money to an International Monetary Fund bail-out fund – being billed as a “new Bretton Woods” after the initiative of 1944 – the details of which will be thrashed out in Washington on November 15.

The prime minister, Sheikh Hamad bin Jassim al-Thani, said: “We are sharing the same world. Qatar is not excluded, so we have to work together.”

Speaking after his three-hour private conversation with the King of Saudi Arabia on Saturday, Brown told the BBC’s Sunday AM programme: “The Saudis will, I think, contribute so we can have a bigger fund worldwide.” Yesterday Kuwait said it had still not made up its mind.

Brown’s diplomacy appears to have been in the face of some disquiet among Arab leaders that they are being looked to to provide funds to shore up ailing countries. A senior government source involved in the talks said the Arab states did not want to be cast as the West’s “cash cow”.

The business secretary, Peter Mandelson, travelling with Brown, also appeared to play down expectations of big results from the visit, telling journalists that the trip was a “process, not an event”.

The climate change minister, Ed Miliband, who was also in Qatar, signed a deal between Qatar and the UK to invest in the development of green technologies. Of the £250m Low Carbon Innovation Partnership, he announced £100m was to be provided by the government of Qatar to invest in research into sustainable energy in the UK. A further £10m would come from the UK’s Carbon Trust and the government hoped £90m would be raised from investors.

Miliband said: “It will use British expertise in renewable technology, matching it with investment from Qatar and the private sector in Britain. It will help take us another step on the road to a green revolution.”

Though the trip has many ambitions, Brown has concentrated on securing Gulf support for the emergency IMF bail-out fund before the Washington summit. He believes the oil-rich countries in the Gulf have profited from the higher oil prices of recent years – something he put at $1tn – which he believes puts them in a position to contribute. He would like to see the $250bn in the IMF’s pot increased by “hundreds of billions”.

Adding further significance to the Washington meeting, Brown told Sunday AM that the fall in inflation was creating the economic conditions for a fall in interest rates. The Bank of England’s monetary policy committee meets this week to decide what to do.

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