RIYADH: The IMF needs hundreds of billions of dollars to protect struggling economies from the global financial crisis, Britain s Gordon Brown said on Sunday, as he led a business and ministerial delegation to the Gulf States.
With many developed countries strapped for cash, Prime Minister Brown wants countries with large financial resources such as China and oil-rich Gulf States to contribute to a new International Monetary Fund facility aimed at keeping vulnerable economies afloat.
If we are to stop the spread of the financial crisis, we need a better global insurance policy to help distressed economies, Brown said.
That is why I have called for more resources for the IMF – hundreds of billions of dollars on top of the $250 billion they already have available – to lend to those countries at risk of financial collapse.
Brown has positioned himself at the forefront of the global response to the credit crisis, a move that has helped to boost the poll ratings of his out-of-favor ruling Labor Party ahead of an election due by May 2010.
The oil producing countries, who have generated over $1 trillion from higher oil prices in recent years, are in a position to contribute, Brown said.
This may seem remote from the every day concerns of British families, but it is only by stabilizing the world economy that we can lay the foundations for economic recovery.
Brown is leading a high level business and ministerial delegation to the Gulf States this weekend to also encourage more investment from the cash-rich region and help in steadying volatile oil prices.
The Gulf States are an increasingly important source of inward investment to the UK, Brown said. As long as they play by our rules and operate in a commercial manner, we welcome investment from sovereign wealth funds in the UK.
This week, British bank Barclays took an injection of capital from Qatar and Abu Dhabi to repair damage from the credit crisis and as an alternative to seeking government help.
Business minister Peter Mandelson and energy minister Ed Miliband, along with leaders from big British firms such as Rolls Royce and Centrica, are accompanying Brown on the trip, which government aides insist is not a begging mission for investment.
Britain s economy is nearing its first recession since the early 1990s and foreign investment could help speed up its recovery.
Details of Gulf investment in renewable energy technologies are expected this weekend.
Gulf oil and gas revenues have provided masses of finance for the region but will now also be used to help kickstart the British green energy revolution, Miliband said.
The Gulf States recognize the UK too has natural assets like wind to offer investment opportunities for them.
Brown said Sunday he expects Saudi Arabia to contribute to the International Monetary Fund s bailout reserves after he promised business leaders in the Gulf that they would have a say in any future new world economic order.
The Saudis will I think contribute so we can have a bigger fund worldwide, he said after a meeting with Saudi Arabia s King Abdullah late Saturday and business leaders early Sunday.
The British leader told reporters traveling with him that he wants hundreds of billions of extra dollars pledged to the IMF fund, noting that the Middle East and Asia, particularly China, have significant foreign exchange reserves.
Brown has attempted to win favor with Arab states by stressing they have not been represented enough on international bodies and promising them a seat at the table amid discussions by world leaders grasping toward new world order.
He repeated his calls for a stable crude oil price on Sunday, citing the need for a sustainable transition to a more low carbon emissions economy for the longer-term.
Britain has planned an oil summit in London in early December to follow up the talks between oil producers and consumers led by Abdullah in Jeddah in July when the oil price was at a record $147.
