The rapacious pursuit of profits by "super-bankers" has triggered an economic crisis that risks delaying anti-poverty targets, according to a senior United Nations official.

Kemal Derviş, the head of the United Nations Development Programme, said the blame for the three economic shocks to have erupted in the past decade — the Asian crisis of 1997, the dot-com crisis of 2001 and the current US sub-prime crisis — falls at the feet of an overly-influential and under-regulated financial sector.

"It is the super-bankers, hedge-fund managers and owners of private equity firms that have become the new 'barons' of twenty-first century capitalism," the former Turkish finance minister and vice-president of the World Bank said during a visit to India.

"It is almost unbelievable: 40 per cent of total corporate profits in the US in recent years went to the financial sector that in itself does not 'produce' … but that 'intermediates and organises' the resources that do produce."

At the Exim Bank Commencement Day Annual Lecture in Bombay, Mr Derviş said that a steep decline in global economic growth is in danger of pushing back the UN's Millennium Development Goals, which call for extreme poverty to be halved and the spread of HIV/Aids to be halted by 2015.

"A world economy growing at four to five per cent in purchasing parity terms is a wonderful thing for development. A major slowdown would be a tremendous set-back," he said.

Although most global institutions have already lowered growth forecasts for this year, many were "still way too optimistic" he added.

According to Mr Derviş, irrational and herd-minded financiers profit hugely from the inflation of asset bubbles, "but pay very little personal penalty when the bubble bursts". Instead, ordinary people bear the costs — directly through government bail-outs of failed banks and indirectly through higher inflation stoked by aggresive cuts to interest rates.

Mr Derviş's calls for a globally co-ordinated response to the current crisis echoes those of Dominique Strauss-Kahn, the head of the IMF, who recently rubbished the notion that Asia's fast-emerging economies — including India and China — had "decoupled" from the West and would remain immune to the aftershocks of the US sub-prime loans crisis.

However, the UN development chief was muted in his response to US efforts to rejuvenate its economy through a massive fiscal stimulus package, voicing a fear that such policies are only paving the way for the next asset bubble.

"The strongly expansionist US policy response carries with it the dangers of an inflationary impulse and of causing again what happened three times in the last ten years: replacing one asset bubble by another," he said.

"After emerging market debt in the mid-1990s, dot-com stocks at the turn of the century and mortgage backed securities in the 2005-2007 period, it may well be that commodities are now rising in price at an unreasonable and unsustainable rate … which again could be seen as a decoupling of real sector expectations from the mood in the financial sector."

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