World Council of Churches
2-8 November 2018
Doc. No. 03.6
Statement on the Urgent Challenge of Economic Transformation:
10 years after the Global Financial Crisis
The executive committee of the World Council of Churches meeting in Uppsala, Sweden, on 2-8 November 2018, observes that this year marks the 10th anniversary of the global financial crisis, the continuing consequences of which include escalating levels of income inequality, even greater concentration of wealth in the hands of an even smaller group of economic elites, increased economic precariousness for a larger majority of the world’s population, widespread youth unemployment, growing sovereign indebtedness, social and political instability, and the rise of populist political forces in many contexts around the world.
We observe that hardly any key actors in the practices that generated the crisis were ultimately held accountable for the global harm done, that the political opportunity in the immediate aftermath of the crisis for making systemic reforms of economic policy and practice was largely missed, and that the few regulatory measures put in place after the crisis have been rolled back. The unconstrained greed of an unaccountable few continues to create risks threatening the future of many, and the conditions for another global financial and economic crisis of even greater dimensions are rapidly emerging again.
Moreover, we note that today many governments are again falling into debt crisis and are struggling to finance the sustainable development goals due in part to corruption, corporate tax evasion, tax competition, and the erosion of tax bases.
We further note that the urgent challenge of climate change demands a global financial and economic system that applies new economic indicators (other than the growth-centric gross domestic product) accounting for social and ecological impacts, that prioritises investments in ecological sustainability, and that reduces debt dependency so as to free up resources for social and ecological renewal. This challenge has recently been dramatically underlined by a special report by the UN Intergovernmental Panel on Climate Change (IPCC) on the impacts of global warming of 1.5°C above pre-industrial levels which indicates that avoiding catastrophic impacts of climate change will require transforming the world economy at a speed and scale that has no historic precedent.
The WCC executive committee therefore:
Renews its oft-repeated call for a new international financial and economic architecture for an economy of life that links finance to the real economy, accounts for social and ecological impacts, and sets effective constraints on greed.
Calls for effective regulation and real accountability for those individuals and entities – including transnational corporations and financial institutions regarded as “too big to fail” – whose greed and corrupt practices have created, and continue to create, risks of widespread and disastrous economic crisis and instability, and deprive nations of the resources needed for equitable and sustainable development.
Encourages the efforts of the WCC, the World Communion of Reformed Churches (WCRC), the Council for World Mission (CWM), and the Lutheran World Federation (LWF) for a New International Financial and Economic Architecture (NIFEA), and of all churches and ecumenical and interfaith partners in this regard.
Affirms the work of the Ecumenical Panel on a NIFEA and the Ecumenical School on Governance, Economics and Management for an Economy of Life to build economic literacy and competence within churches by equipping participants with the tools and language to effectively advocate for urgent transformations in the global financial and economic realm.
Asks the WCC to collaborate with ecumenical and other partners in convening broader consultations for financial and economic transformation – engaging different categories of expertise represented within the churches – including in the areas of (1) taxation as a tool for promoting redistribution, accountability and sustainability; (2) regulating and democratising finance; and (3) post-growth economics.