Brussels September 18 1998. (ICFTU Info):"The world’s leading industrial powers must take immediate action to prevent the collapse of the Latin American economies in the light of the massive currency shifts by financial speculators out of Brazil last week," said the Bill Jordan, ICFTU General Secretary.

The G7, Finance Ministers and Central Banks from the leading industrial countries need to assume their responsibilities by taking decisive measures to re-establish confidence in Latin American economies and to ensure co-ordinated international measures to stop global recession, said the ICFTU.

The ICFTU believes that the following measures need to be taken, so that the key lessons of the Asian crisis are learned and the crisis is not repeated in Latin America.

Immediate action must be taken to halt the enormous speculative shifts in short-term capital flows out of Latin America;

Major reforms must be made to the structural adjustment policies of the World Bank and IMF so as to promote social development that includes respect for human rights, and meets basic needs in health and education. These policies must include provision for social protection and support for the establishment of social safety nets, job creation and income-transfer schemes, in order to cushion the effects of the crisis on ordinary working people and the poor and to stimulate demand through social sector spending;

It is time to lift the strangling burden of excessive debts on the developing countries of Latin America which still endures from the debt crisis of the 1980s.

Last week, over a billion dollars a day left Brazil in a massive currency flight as international financial speculators, in safeguarding their own interests, inflicted serious damage on a country they had been profiting from. Last month, Venezuela teetered on the brink of becoming another victim of economic crisis.

If one Latin America country collapses, there could be a "domino effect" as others follow, leading the whole continent into a major financial and economic crisis, says the ICFTU. The IMF has now halved its economic growth forecasts for the world economy and on 17 September, the world’s stock markets underwent one of the largest collapses in recent history.

"The message is clear", said Bill Jordan, "The failure of the G7 to act on the Asian and now Russian economic crises is pushing Latin America into financial crisis, and unless they act decisively now the whole world economy could be pushed into outright recession, hitting workers in every country of the world. The ICFTU intends shortly to submit proposals to IMF, World Bank and G7 demanding immediate comprehensive measures to end the global financial crisis and the beginning of the reform of the world's financial structures".