The turbulence in the world's financial markets provides a chance to make widespread reforms to help avoid more crises, Prime Minister Gordon Brown said in a newspaper article on Friday.
Writing in the Financial Times, he called for greater transparency in the markets and a global early warning system to help cope with any future turmoil. "Most political and business leaders gathered at the World Economic Forum this week agree on one thing: the global economy is facing its biggest test in more than a decade," Brown wrote in an opinion piece.
"But we should also agree that turbulent conditions, throughout history, have been an opportunity for reform.
"This latest test of world financial systems presents a window in which to address fundamental issues that, if tackled properly, will improve economic management, regulation and the fight against inflation, and help us prevent similar crises in the future," Brown said.
"In their search for higher returns, investors underpriced the risks in a number of markets, particularly in the markets for complex derivative products.
"Recent turbulence, where loan risks were transferred to those least able to understand them, has exposed four big questions and issues for policymakers around the globe." He said those issues are: reform of the international financial institutions; better cross-border crisis-management; greater transparency in the markets and support for globalisation over protectionism.
