Reform is needed. Reform is in the air. We can't afford to fail

The task is to build a new financial architecture. If we flunk it, the pain will strike most cruelly in the world's poorest countries

Joseph Stiglitz
The Guardian, Friday 27 March 2009

The financial crisis that began in America's sub-prime mortgage market has now become a global recession – with growth projected to be a negative 1.5%, the worst performance since the Great Depression. Even countries that had done everything right are seeing marked declines in growth rates, and even deep recessions. And much of the most acute pain will be felt by developing countries.

A UN commission of experts on reforms of the international monetary and financial system, which I chair, has just published its preliminary report. It focuses especially on the impact of the crisis on developing countries and the poor everywhere, which is likely to be severe. An estimated 30 million more people will be unemployed in 2009 compared to 2007. The increase could even reach 50 million. Progress in reducing poverty may be halted. The report warns that: "Some 200 million people, mostly in developing economies, could be pushed into poverty if rapid action is not taken to counter the impact of the crisis."