Global crisis: World agencies call for consensus

A new 'multilateral consensus' is needed to help head off a global economic slowdown and recession, the head of the United Nations International Labour Organisation (ILO) has told the International Monetary Fund and the World Bank.

Speaking at the annual spring meetings of the two Washington-based institutions, ILO Director-General Juan Somavia also called for closer ties between his agency, the IMF and the World Bank.

A multilateral consensus, on a wide range of issues ranging from widening income gaps to climate change bringing together rich and poor countries, employers and employees, is needed, Somavia said.

"The ILO's tried and tested mechanisms of social dialogue and tripartite discussions are particularly vital in building consensus around policies to avert a steep slowdown and move out of recession," he said, referring to the agency's practice of discussions involving governments, employers and workers.

He warned that recent IMF forecasts have projected that global growth could drop below the point that is equivalent to a global recession, causing further problems for labour markets around the world this year.

"The scale of the financial restructuring now under way and the severity of the credit squeeze make the current financial crisis perhaps the most severe since 1945 and may result in markedly slower growth in the USA and other industrialised countries for as much as two to three year," he said.