Explanation of Position by John F. Sammis, U.S. Deputy Representative on the United Nations Economic and Social Council, on Agenda Item 51(b): International Financial System and Development, in the Second Committee of the Sixty-Fourth Session of the United Nations General Assembly

John F. Sammis
United States Deputy Representative to ECOSOC 
U.S. Mission to the United Nations 
New York, NY
December 11, 2009




AS DELIVERED

Mr. Chairman, the United States is pleased to join consensus today on this important resolution that underscores both the challenges that the global economic crisis poses and the progress that the international community has made since the June Financial Crisis Conference in mitigating the impact of the crisis on developing countries.

We support closer consultation and coordination between the UN System and other international organizations, including the Bretton Woods Institutions, in order to advance the UN’s core development mandate.  But the dialogue among these institutions must respect their differing mandates and responsibilities.  My government does not interpret the language in this resolution as endorsing a formal United Nations role in decisions affecting the international financial institutions or international financial architecture

The United States continues to believe that the United Nations is not the best forum for meaningful discussion on reform of the international monetary system, and we deeply regret that this resolution does not refer in a more explicit and constructive way to the important work already being done at the IMF and in the G-20. 

The United States expressed it views on many of the issues raised in this resolution in our Explanation of Position commenting on the outcome document from the June Financial Crisis Conference, including the use of capital controls to deal with balance of payments problems.  The United States does not condone the use of capital controls and their efficacy should not be assumed.  If used, capital controls should only be taken as a last resort and on a temporary basis as possible breathing space for more comprehensive economic reform, and in accordance with existing multilateral and bilateral frameworks and agreements

The G-20 Leaders, at their April Summit in London, supported a general SDR allocation of $250 billion to help stop a serious capital drain and contagion risk facing emerging market and developing countries.  The action was an exceptional measure taken during the height of the global financial crisis.  The role of the SDR in the international monetary system raises complex considerations, and there is very little consensus on its role.  We wish to underscore decisions on the SDR are within the sole purview of the IMF.

Thank you.

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PRN: 2009/316