New York - World leaders called for a revival of global institutions on Tuesday as economic crises have undermined development and growing violence and conflicts have threatened peace and stability.

In a stark address before more than 100 world leaders at the United Nations General Assembly in New York, UN Secretary General Ban Ki-moon warned that the world was facing countless crises at a time when the leadership to address the turmoil was lacking.

"We all recognize the perils of our current passage. We face a global financial crisis. A global energy crisis. A global food crisis," Ban said.

But "we also face a crisis of a different sort ... a challenge of global leadership," he said.

Other foreign leaders joined the appeal for the international community to come together to address the many global challenges.

French President Nicolas Sarkozy called for an expansion of the UN Security Council and the Group of Eight industrialized nations.

US President George W Bush, in his final speech before the UN, said the world must unite in the fight against extremism and terrorism.

"Instead of only passing resolutions decrying terrorist attacks after they occur, we must cooperate more closely to keep terrorist attacks from happening in the first place," Bush said.

He said nations have a responsibility to ensure terrorists cannot find safe haven on their soil, and called on countries to combat arms proliferation, human trafficking and organized crime.

A number of foreign leaders called for a new global financial order after a massive crisis in the US banking sector last week sent global stock markets on a nosedive, prompting the US Congress this week to consider a 700-billion-dollar rescue package.

Bush sought to allay foreign leaders' concerns. The US was taking "bold steps to prevent a severe disruption of the American economy, which would have a devastating effect on other economies around the world," he said.

Ban said a re-evaluation of the power of markets and capitalism was needed as the financial turmoil threatened to derail economic growth and cut aid to developing countries.

"We need a new understanding on business ethics and governance, with more compassion and less uncritical faith in the magic of markets," he said.

Sarkozy said the world must "rebuild capitalism," while Brazilian President Luiz Inacio Lula da Silva slammed the "boundless greed" of market speculators for putting global growth at risk.

Lula said it was up to those governments "at the heart of the crisis" to bring the more immediate "disorder" under control, but called for fresh international economic institutions to help improve regulation and make long-term changes to the global financial system.

African nations, in a one-day conference Monday, warned richer nations not to allow the financial turmoil to divert resources from foreign aid, which was sorely needed to meet the developing world's own crisis over the surge in food and energy prices in recent years.

Ban said there was a danger that countries were beginning to turn "inward" at a time when the world's challenges more than ever required multilateral solutions.

International action was needed on everything from solving climate change, to reducing poverty, to fighting terrorism.

"If ever there were a call to collective action, a call for global leadership, it is now," Ban said.

Big changes in the way the UN does business were also needed. Ban slammed his own institution for a "dysfunctional" contract-awarding system and promised to unveil a new set of reforms in the next few weeks.

"We need to change the UN culture. We need to become faster, more flexible and more effective - more modern," he said.

More than 100 world leaders were set to address the General Assembly between Tuesday and Friday, marking the start of a new year for the world body.

Iranian President Mahmoud Ahmadinejad was among those slated for the afternoon session Tuesday. A few hundred protesters gathered outside UN headquarters in New York, chanting, "Ahmadinejad, out of the UN."

His appearance was also slammed by Israeli President Shimon Peres, who told reporters that Ahmadinejad advocated a "return to the age of darkness."