India, Brazil, and South Africa, which form the Ibsa Dialogue Forum, are to urgently coordinate their responses to the global financial crisis, the leaders of the three countries announced at a press conference marking the end of the third Ibsa Summit, in Delhi, on Wednesday afternoon.

Speaking first, as host, Indian Prime Minister Manmohan Singh stated that "we have decided to instruct our Finance Ministers and Governors of Reserve Banks to meet as soon as possible to create a coordinating mechanism," to meet the crisis.

"We discussed and analysed the current financial crisis," added South African President Kgalema Motlanthe, "and agreed we need to direct our Ministers of Finance, Central Bank Governors, and Ministers of Trade and Industry, to come together and develop an adequate response to this crisis. We also discussed the consolidation and expansion of trade among our countries."

However, it was Brazilian President Luiz Inacio Lula da Silva who, in response to a direct question on what the Ibsa countries would do to confront the crisis, gave the most detailed statement. "The first task for emerging countries - we've done it already. Our economies are stabilised. We all have reserves in hard currency. We all have surpluses.

"We have full control over our financial systems. The second task is not to allow this crisis to affect our countries. We should be more bold, have more determination. We should establish much greater trade flows between emerging countries, and strengthen our internal markets. Here, in Ibsa [summit] we have decided that it is necessary to call for the immediate meeting of Finance Ministers of the three countries, of our Central Bank Governors, Ministers of Trade and Industry, and Foreign Ministers, to achieve a joint position between the three Ibsa countries. This is urgent."

President Lula da Silva went on to say that the three countries also had to "talk to our friends in the US and EU" to press them to do what it takes to prevent this crisis from affecting developing countries, "which did not partake in this casino" and establish effective supervision and regulation of their financial systems.

Pointing out that he had expressed concern about the subprime mortgage situation in the US last year, he asserted that "only in the past two weeks did the principal leaders of Europe and the US finally realise that a crisis was going on in their countries. This is inconceivable. They could have acted ten months ago, five months ago."

He warned that, if the result of the financial crisis is a recession in Europe (and the US), it could affect emerging countries. "Because they are buyers and we are sellers," as he succinctly put it. "We need to diversify [our markets]. Brazil and India don't exploit even 10% of our potential," and the same held for South Africa and Brazil. He assured that Brazil would not halt investments in major infrastructure projects and would inject liquidity into the markets.

"Last, but not least," he stressed, "I hope that the International Monetary Fund will tell the US that it is necessary for them to establish regulatory systems for their financial system. And Central Bankers should agree that it should be forbidden for investment banks to have no cap on leveraging."

The Delhi Summit Declaration, issued after the press conference, includes a section on the crisis. "This unprecedented turbulence in financial markets and the resulting instability threatens global prosperity," it states. "The explosion of new financial instruments, unaccompanied by credible and systemic regulation, has resulted amongst others in a major crisis of confidence for which those held responsible should be held accountable and liable." The declaration also calls for a new international initiative to achieve structural reform of the global financial system. "The new initiative must take into account the fact that ethics must also apply to the economy .... The reform must be undertaken so as to incorporate stronger systems of multinational consultations and surveillance as an integral part .... [and be] as inclusive as possible and must be transparent."

The end of this third Ibsa Summit saw the signing of seven new trilateral agreements. These were two five-year action plans, both for the period from 2008 to 2013, one for civil aviation and the other for maritime projects; a tripartite agreement under Ibsa on tourism; and four memorandums of understanding, on cooperation in the field of the environment, on cooperation on women's development and gender equality, on cooperation on human settlement development, and on trade facilitation, covering standards, technical regulations and conformity.

The next Ibsa summit will take place next October in Brazil.

(Keith Campbell has attended the Third Ibsa Summit in Delhi as the guest of the India Brand Equity Foundation of the Confederation of Indian Industries.)