Pope Benedict signs his third encyclical of his pontificate at the Vatican. (L'Osservatore Romano/Associated Press)

Pope Benedict XVI called Tuesday for a new world financial order guided by ethics, dignity and the search for the common good in the third encyclical of his pontificate.

In Charity in Truth, Benedict denounced the profit-at-all-cost mentality of the globalized economy and lamented that greed had brought about the worst economic downturn since the Great Depression.

"Profit is useful if it serves as a means towards an end that provides a sense both of how to produce it and how to make good use of it," he wrote. "Once profit becomes the exclusive goal, if it is produced by improper means and without the common good as its ultimate end, it risks destroying wealth and creating poverty."

The 144-page document, in the works for two years and repeatedly delayed to incorporate the fallout from the crisis, was released one day before leaders of the Group of Eight industrialized nations meet to co-ordinate efforts to deal with the global economic meltdown.

The release was clearly designed to give world leaders a strong moral imperative to correct errors of the past, "which wreaked such havoc on the real economy," and make a more socially just and responsible world financial order.

"The economy needs ethics in order to function correctly — not any ethics, but an ethics which is people centred," he wrote.

Globalization poses threat: Pope

The German-born Benedict, 82, has spoken out frequently about the effects of the crisis on the poor, particularly in Africa, which he visited earlier this year.

While acknowledging that the globalized economy has "lifted billions of people out of misery," Benedict accused the unbridled growth of recent years of causing unprecedented problems as well, citing mass migration flows, environmental degradation and a complete loss of trust in the world market.

He urged wealthier countries to increase development aid to poor countries to help eliminate world hunger, saying peace and security depended on it.

He specified that aid should go to agricultural development to improve infrastructure, irrigation systems, transport and sharing of agricultural technology.

At the same time, he demanded that industrialized nations reduce their energy consumption, both to better care for the environment and to let the poorer nations have access to energy resources.

"One of the greatest challenges facing the economy is to achieve the most efficient use — not abuse — of natural resources, based on a realization that the notion of 'efficiency' is not value-free," he wrote.

He lamented that the drive to outsource work to the cheapest bidder had endangered the rights of workers, and demanded that workers be allowed to organize in unions to protect their rights and guarantee steady, decent employment.

Benedict called for a whole new financial order — "a profoundly new way of understanding business enterprise" — that respects the dignity of workers and looks out for the common good by prioritizing ethics and social responsibility over dividend returns.

Benedict stressed he wasn't opposed to a globalized economy, saying that if done correctly it has an unprecedented potential to redistribute wealth around the globe.

But he warned that if badly directed and if the problems aren't fixed, globalization could increase poverty and inequality and trigger the type of crisis under way.