FACTBOX-Excerpts from U.N. proposals for financial reforms

June 26 (Reuters) - A U.N. conference on the global financial crisis adopted a resolution on Friday urging reform of the global economic system and financial organizations like the World Bank and International Monetary Fund. [ID:nN26351379]

Washington joined the more than 140 other countries at the conference in backing the resolution. However, U.S. Deputy Ambassador John Sammis said after it was adopted that the United Nations lacked the authority and expertise to carry out any such overhaul.

Following are excerpts from the 15-page resolution.

DEBT RELIEF

"We affirm that the appropriate measures must be taken to mitigate the negative effects of the crisis on the indebtedness of developing States and to avoid a new debt crisis. In that regard, we support making full use of the existing flexibility within the Debt Sustainability Framework."...

"We call upon States to redouble efforts to honour their commitments regarding debt relief."

SDRs

"We recognize that increases in global liquidity play a useful role in overcoming the financial crisis. Therefore, we strongly support and call for early implementation of the new general special drawing right (SDR) allocation of $250 billion."

FOREIGN CURRENCY RESERVES

"The crisis has intensified calls by some States for reform of the current global reserve system to overcome its insufficiencies. We acknowledge the calls by many States for further study of the feasibility and advisability of a more efficient reserve system, including the possible function of SDRs in any such system ..."

FINANCIAL MARKET REGULATION

"The current crisis has revealed many deficiencies in national and international financial regulation and supervision. We recognize the critical need for expanding the scope of regulation and supervision and making it more effective, with respect to all major financial centres, instruments and actors, including financial institutions, credit rating agencies and hedge funds. The need for tighter and more coordinated regulation of incentives, derivatives and the trading of standardized contracts is also apparent. We reject the imposition of needlessly onerous regulatory requirements ..."

REFORM OF IMF, WORLD BANK

"We stress the urgent need for further reform of the governance of the Bretton Woods institutions (such as the International Monetary Fund and World Bank), on the basis of a fair and equitable representation of developing countries, in order to increase the credibility and accountability of these institutions."

"We strongly support completion of the next (IMF) quota review, which, based on current trends, is expected to result in an increase in the quota shares of dynamic economies, particularly in the share of emerging market and developing countries as a whole, to be completed no later than January 2011."

"We agree that the heads and senior leadership of the international financial institutions, particularly the Bretton Woods institutions, should be appointed through open, transparent and merit-based selection processes, with due regard to gender equality and geographical and regional representation."

The full text of the document can be found at:here (Compiled by Louis Charbonneau; Editing by Xavier Briand)