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destructive as an adventurous stock market game.
* * *
Dear Ladies and Gentlemen,
Unfortunately, we are still far from fully fathoming the real scale of the current crisis. One thing though
is obvious: the intensity and the continuance of the recession will largely depend on how precisely we will define
the direction of our actions; and how coordinated and professional we shall be.
The first step that we think is essential to take in the nearest future is to literally and figuratively draw the
line under our past. It is show-down time. We need to figure out the real state of affairs.
The businesses need to write off their irrecoverable debts and “bad” assets. Yes, it is a very painful and
unpleasant process. And not everyone does it willingly, having fears for their capitalisation, bonuses or
reputation.
But, avoiding clearing the balance means “preserving” and prolonging the crisis. I think that the writing-
off mechanism must be effective and fit the realities of today’s economy.
Secondly, together with clearing the balance, it is time to go free from virtual money, made-up reports
and doubtful ratings. The understanding of the health of the world economy and the real state of things with
corporations must not be made vague by illusions. Even if the authors of those illusions sit in the world’s largest
audit and consulting agencies.
The essence of our suggestion is that the principle of fundamental asset cost would be returned and put as
the basis for the reform of audit, accounting and rating system standards. That is, the evaluation of this or that
business must be built upon its capacity to generate the added value. We think that the economy of the future
must be the economy of real values. How to get there? – That is the question put forward for all of us. Let’s work
on it together.
Thirdly, the excessive dependence on what is basically the only reserve currency is dangerous for the
world economy. So it would be reasonable to stimulate a process of getting a number of strong reserve
currencies in the future. It is time to start a specific dialogue on how to make the transition into a new model –
smooth and irreversible.
Fourthly, most countries keep their international reserves in foreign currencies. And they would want to
be confident of their security. In their turn, the emitters of the reserve and accounting currencies are objectively
interested to see that their money is in demand in other countries.
That is, that mutual interest and mutual dependence are clearly in place.
It is of vital importance that the countries responsible for the world’s reserve currencies offer more
transparency for their credit and monetary policies.
These countries should take up a commitment to be guided in those policies by internationally adopted
rules of macroeconomic and financial security.
And demand for such committed approach is pressing.
But beyond global finances, there are many other issues that are calling for a solution.
The unipolar pattern of the world economy that is completely outdated by now must be replaced by a new
system based on cooperation of several big centres.
But to avoid chaos and unpredictable behaviour in a multipolar world, we need to bolster the network of
global regulators – working in full compliance with international law and multilateral agreements. This is why
we are calling for a re-think of the role of leading international organisations and institutions.
I am convinced that we are able to build a more fair and effective economic architecture for the whole
world. However, due to time restraints it’s impossible to outline all the details of the proposed structure in this
short speech.
Still, it’s obvious that in such a system all the countries must have guaranteed access to the resources they
need for life, also access to new technologies and resources for further development. The world must work out
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