Gordon Brown Calls for Reform of Global Institutions

JOANNA SLATER

A return to protectionism and a lack of cooperation among countries are the most worrisome risks facing the world economy, U.K. Prime Minister Gordon Brown said Wednesday.

U.K. Prime Minister Gordon Brown spoke with Robert Thomson, managing editor of The Journal.

"The greatest danger we face as trade starts to fall is that countries will resort to protectionist measures," said Mr. Brown, who pledged that preventing such moves would be at the top of the agenda at next week's summit of the Group of 20 nations in London.

Mr. Brown has been trying to persuade leaders of the G-20 to back calls by U.S. President Barack Obama for significant new government spending measures to try to jump-start the struggling world economy, moves resisted in some parts of Europe.

The summit is the start of a process, Mr. Brown said, which "must end with the reform of the global institutions." Mr. Brown, speaking at a Wall Street Journal event in New York, argued that institutions like the International Monetary Fund and the World Bank, created in an earlier era, must change to address the challenges of a globalized economy.

He stressed the need for greater funding of the IMF, both to help countries prevent crises and tackle them once they have occurred, particularly in hard-hit regions like central and eastern Europe.

Mr. Brown downplayed an apparent disagreement between himself and Bank of England governor Mervyn King over whether the U.K. was in a position to expand its own stimulus package. Mr. King would agree, Mr. Brown said, that "we've got to be ready to take the action necessary to support growth."