Path to Renewed Globalization Critical for New World Economic Order, Governor Carney says



    MONTREAL, June 11 /CNW Telbec/ - Countries around the world must work
toward a new global economy that is open, resilient, and responsible, Bank of
Canada Governor Mark Carney said today, as he laid out an agenda for the
renewal of globalization. How effectively countries navigate the current
interim period will be critical to the success of the international economic
order in the years ahead, he cautioned.
    "How we manage the rebalancing of the global economy could profoundly
influence how open, equitable, and prosperous the New World Order will be,"
Governor Carney said in a speech delivered to the 15th Annual International
Economic Forum of the Americas.
    The world is now experiencing the "inevitable correction of global
imbalances," and this will serve as a drag on global economic growth, Governor
Carney noted. Across economies, demand must rotate from deficit to surplus
countries. Internally, adjustments in inventories, labour, and capital will be
required. As well, the private sector must re-assume most of the risk that the
crisis has pushed onto the public sector, correcting an imbalance that impedes
the return to normal market function.
    "Globalization lifted hundreds of millions of people out of poverty and
created the potential for hundreds of millions more to share their destiny,"
Governor Carney said. "Globalized product, capital, and labour markets lie at
the heart of the New World Order to which we should aspire."
    Governor Carney singled out four priorities for central banks in this
critical interim period. Transparency should be increased so that risk can be
more effectively identified. Core funding markets should be made more
efficient and less susceptible to extreme price movements. Macroprudential
regulations must be enacted to smooth the credit cycle. Finally, all countries
must accept their responsibilities for promoting an open, flexible, and
resilient international monetary system.
    The Bank of Canada is working with domestic and international partners to
build more resilient markets and to create an open, global financial system.
In conclusion, Governor Carney said that Canada is showing leadership and
should be "among the first" to implement the agenda for the renewal of a more
resilient, more responsible globalization.




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For further information: Jeremy Harrison, (613) 782-8782


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