World leaders called for urgent steps to tackle the global financial crisis and said the time had come for a sweeping reform of multilateral institutions, including the UN Security Council, according to AFP.

The world`s financial meltdown took center stage here Tuesday as the UN General Assembly kicked off its annual debate, with UN chief Ban Ki-moon stressing the need to "restore order to the international financial markets."

US President George W. Bush, making his farewell speech to the 192-member assembly, assured worried world leaders that his administration and the US Congress would approve an emergency 700-billion-dollar Wall Street bailout "in the urgent timeframe required."

In his remarks, Sarkozy said world leaders most directly concerned by the issue had a duty "to meet before the end of the year to examine together the lessons of the most serious financial crisis the world has experienced since that of the 1930s."

He later told a press conference that he had in mind a "G8 format," referring to the eight leading economic powers, that could be opened to "emerging countries."

"Let us rebuild together a regulated capitalism in which whole swathes of financial activity are not left to the sole judgment of market operators, in which banks do their job, which is to finance economic development rather than engage in speculation," Sarkozy, who holds the rotating presidency of the European Union, told the assembly.

Both Sarkozy and his Brazilian counterpart Luiz Inacio Lula da Silva pressed for a sweeping reform of multilateral institutions, including the powerful Security Council.

The French leader said enlarging the 15-member UN Security Council as well as the G8 club of leading industrialized nations -- Britain, Canada, France, Germany, Italy, Japan, the United States and Russia -- was not "just a matter of fairness, (but) also the necessary condition for being able to act effectively."

Lula made a similar point, noting that "only legitimate and effective instruments can assure collective security."

"The United Nations has spent 15 years discussing the reform of the Security Council," he noted. "Today`s structure has been frozen for six decades and does not relate to the challenges of today`s world."

Lula welcomed the General Assembly`s decision last week to begin inter-governmental talks on expanding the powerful Security Council no later than next February 28.

The thorny issue of how to enlarge a body that has remained largely unchanged since the establishment of the United Nations in 1945 has for years divided the UN membership.

The council currently has 10 rotating, non-permanent members and five, veto-wielding permanent ones (China, United States, France, Britain and Russia).

Lula also stressed that "The economic international institutions today have neither the authority nor the instruments they need to stop the anarchy of speculation."

"We must rebuild them on an entirely new basis," he added. In the past Lula has called for institutions such as the International Monetary Fund and the World Bank to be more responsive to the needs of developing economies.

Just four months before he leaves office at the end of his eight-year run at the White House, Bush also accused Syria and Iran of backing terrorism and leveled some of his toughest-yet criticism at Moscow over its war with Georgia.

"The United Nations charter sets forth the equal rights of nations large and small. Russia`s invasion of Georgia was a violation of those words," he said, vowing to keep supporting the former Soviet republic`s territorial integrity.

The US leader also urged the world body to fully implement sanctions against North Korea and Iran over their nuclear programs, warning: "We must not relent until our people are safe from this threat to civilization."

Thursday, US Secretary of State Condoleezza Rice was due to meet with her counterparts from Britain, Russia, France, China and Germany on the margins of the assembly session to weigh prospects for a fourth round of sanctions against Iran over its refusal to halt sensitive nuclear fuel work.

Meanwhile, Serbian President Boris Tadic urged the Assembly Tuesday to back his country`s call for a ruling by the International Court of Justice on Kosovo`s unilateral independence from Belgrade.

Serbia last month submitted a request before the United Nations for an advisory ruling by the ICJ on Kosovo`s independence, saying the approach could serve as a model to settle other similar disputes.

Ethnic Albanian-majority Kosovo, a UN-run province of Serbia since 1999 when it was wrested from Belgrade`s control in a NATO air war, unilaterally seceded from Belgrade on February 17.

Its statehood has been recognized by 46 countries, including the United States and most European Union nations, but is opposed by Serbia and its Moscow ally.