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EXECUTIVE BUREAU – NAIROBI - Session of 7-8 May 2009 - page 2 / 22

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Introduction: The context of the global financial crisis

This Executive Bureau meeting is being held against a background of global economic and financial crisis preceded by a three-fold crisis, a climatic crisis, an energy crisis and a food crisis, which has repercussions on the workers in all countries and circles. The GDP is falling drastically everywhere, causing widespread deflation, a fall in the demand for exports and their prices, a global recession and millions of job losses.

This disaster is just the consequence of neo-liberalism carried to extremes and leading to total and excessive economic deregulation, massive privatisations and job flexibility. Under this system, the multinational companies have imposed a new economic and social order which is solely in conformity with their own strategy and interests and based on an expanding financial sector founded on an artificial economy and quick earnings. Thus, the world has become a gambling place, while labour is a secondary force of production.

In the face of this chaos, the neo-liberal economy is no longer capable of securing the right to work for each and everyone. This is an historic moment when the world is eagerly awaiting the implementation of the conclusions of the latest G20 Summit held in London. It is clear that things have changed and that ultra liberalism has actually failed. There is massive recourse to Keynes’ policies, which had hitherto been rejected, and the decline of neo-liberalism. Huge sums of money provided mostly by taxes levied on workers’ incomes serve to finance the recovery programmes and plans.

The G8 countries, which used to practise orthodox liberal policies, have now become supporters of interventionism. The following examples are given to illustrate this situation in 2009: In the USA, USD 816 billion has been injected into the economy; in Great Britain, 20 billion pounds; in Germany, 30 billion Euros; and in France, 26

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