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THE US has called for action by the industrialised world to save the global economy after corporate giants Nissan and AngloPlatinum cut 30,000 jobs and the ILO warned of social disaster in Europe.

US Treasury Secretary Timothy Geithner urged finance ministers from the Group of Seven leading world economies to act “promptly to restore health to the global economy,” said a statement put out after his conference call with them overnight.

Finance ministers from the Group of Seven are due to meet on Friday in Rome as governments redouble efforts to fight back against a global recession.

The European Union said it would hold a special summit later this month to coordinate action and avoid protectionist measures against the crisis.

US President Barack Obama meanwhile piled pressure on the US Senate to pass his highly contentious spending and tax-cutting stimulus plan of more than $US800 billion to kick-start the world’s largest economy.

The Senate is expected to vote on the stimulus bill on Wednesay (AEDT). Mr Obama has warned of “catastrophe” if the plan is not adopted and held a campaign-style “town hall” meeting in a part of the US state of Indiana heavily hit by job losses in a bid to drum up popular support.

Mr Obama’s administration is also set to unveil a scheme tomrrow for rescuing the financial system. US newspaper reports said the plan will include a government partnership with the private sector to buy banks’ troubled assets.

The uncertainty over Mr Obama’s stimulus plan after days of Congress debates impacted on the markets overnight, with Wall Street holding almost still during morning trading and the dollar falling back against the euro. Japanese share prices closed 1.33 per cent lower, while European stocks were slightly up with London’s FTSE 100 index rising 0.37 per cent. World oil prices held steady after OPEC member Iraq predicted the cartel would announce further production cuts in a market struggling with weak demand.

The crisis also bit further into corporate results for top world companies. “The global auto industry is in turmoil. Nissan is no exception,” said the chief executive of Japan’s Nissan, Carlos Ghosn, as the company forecast a net loss of $US2.9 billion and said it would cut 20,000 jobs worldwide.

The downturn in the auto industry also affected South African miner AngloPlatinum, the world’s biggest producer of platinum, which is used to make catalytic converters for cars. The company said it would cut 10,000 jobs. “The global economic crisis has struck,” said CEO Neville Nicolau. Meanwhile in Britain, Prime Minister Gordon Brown declared an end to the bonus culture for bankers and called for “a new culture that rewards sustainable success,” highlighting a key point of public outrage in the crisis. And in France, newspaper reports said the state would lend €6 billion to ailing carmakers Renault and Peugeot-Citroen in exchange for a promise to halt job losses and rein in executive bonuses. The Geneva-based International Labour Organisation warned that only “swift and bold” action to protect workers and families can avert a “social recession” in Europe on the heels of the economic crisis. ILO director general Juan Somavia said before the opening of the eighth European meeting of the ILO in Lisbon that “we are seeing a dramatic deterioration in output and employment levels across the region.” He added in a statement: “The social and political repercussions of a deep and prolonged recession are daunting. Our priority attention must turn to halting the slide into a full-blown social recession.”

http://www.news.com.au/business/story/0,27753,25033707-462,00.html?referrer=email

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