John Key

Wellington, Nov 24 NZPA - The global financial crisis can be overcome within 18 months by acting "quickly and decisively", Pacific Rim leaders including Prime Minister John Key say.

The 21 Apec leaders, who represent more than half the world's economic power, made the statement in a final declaration at the two day summit.

A spokesman for Mr Key today welcomed the declaration as a strong commitment of political will.

But former prime minister and Word Trade Organisation director Mike Moore said similar statements had been made at the last six Apec's and the real test would be to see whether leaders could deliver on their commitment.

Leaders now needed to return to their various capitals and talk tough to their ministers and officials to make sure they towed the line, he said on Radio New Zealand.

Am ong the statements in the final declaration was support for the Washington Declaration made last weekend by major economies, pledging to maintain free trade despite domestic pressures.

"We are convinced that we can overcome this crisis in a period of 18 months," the leaders said.

"We have already taken urgent and extraordinary steps to stabilise our financial sectors and strengthen economic growth."

The 18-month timeline fits with a calculation by the International Monetary Fund, which forecast developed economies would grow barely 0.1 percent in 2009, and that the world would emerge from the crisis the following year.

Vinod Aggarwal, director of the Apec Study Centre at the University of California-Berkeley, said it was important the leaders agreed to send ministers to Geneva next month to jump-start the so-called Doha round of World Trade Organisation talks.

Concern over the global financial crisis has injected new urgency into the negotiations, which collapsed in July.

The Apec leaders also said they were deeply concerned about instability in food prices, were committed to battling corruption and piracy, and supported "decisive and effective long-term cooperation" to combat climate change. Mr Key yesterday met US President George W Bush and China's President Hu Jintao at the summit.

President Bush congratulated him on his election win, and President Hu invited him to visit China.

Mr Key told reporters at the summit it was important the leaders acted to deal with the international crisis, as well as talk about it.

Mr Key also held formal bilateral meetings with Australian Prime Minister Kevin Rudd, Chilean President Michelle Bachelet, OECD Secretary-General Angel Gurria and Singapore's Prime Minister Lee Hsien Loong.

In a speech at the weekend to Apec's Business Advisory Council, Mr Key pulled no punches when he blamed banks and other financial institutions for plunging the world into crisis.

Mr Key said in many cases there had been a "recklessly complacent attitude to risk" and credit had become out of proportion to real economies.

But his main point was that free trade -- Apec's founding principle -- was the most important way to get out of the crisis.

Mr Key said if the WTO's current round of negotiations to liberalise trade did not reach a successful conclusion, that would represent "nothing short of political failure".

From the Peruvian capital Lima, Mr Key is going to London where he will meet the Queen, Prime Minister Gordon Brown and other political leaders before coming home.

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