Can Reforming Global Institutions Help Developing Countries Share More in the Benefits from Globalization?
Globalization could significantly expand trade, international investment, and technological advances, but the gains from global integration have been unevenly distributed across and within nations. Greater global interdependence has also brought gr...
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| Language: | English en_US |
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World Bank, Washington, DC
2014
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| Online Access: | http://documents.worldbank.org/curated/en/2001/01/888055/can-reforming-global-institutions-help-developing-countries-share-more-benefits-globalization http://hdl.handle.net/10986/19727 |
| Summary: | Globalization could significantly expand
trade, international investment, and technological advances,
but the gains from global integration have been unevenly
distributed across and within nations. Greater global
interdependence has also brought greater macroeconomic
volatility, resulting in several serious financial crises in
the second half of the 1990s. The global matrix of Bretton
Woods and United Nations institutions that developed
starting in the 1940s, formed under a different balance of
power, in a world of fixed exchange rates and limited
capital mobility. Since the 1960s regional financial
institutions have emerged because of the greater autonomy of
different regions and the greater financial needs of
development. The author reviews different proposals for
reform of the international financial institutions and
changes in the roles of the International Monetary Fund
(IMF) and the World Bank. He highlights the implications for
developing countries of (1) Policy conditionality. (2) The
countercyclical role of multilaterals' lending. (3)
Greater lending to middle-income than to low-income
developing countries. (3) Access to liquidity at times of
crisis. (4) Mechanisms for giving low-income countries a
greater voice in IMF and World Bank decisionmaking. The
author streses the overlapping responsibilities of the
Bretton Woods and regional financial institutions and the
need to reassess the allocation of responsibilities and to
develop better coordination mechanisms between these
institutions. Those designing institutional reform must
consider the corporate capabilities of each type of
institution. The corporate cultures of global and regional
institutions differ. So does the kind of knowledge they
generate and disseminate, and so do patterns of interactions
with, and mechanisms for representation of, client
countries.Finally, the author calls attention to the need to
harmonize national and global growth-oriented policies in a
way that reduces volatility and promotes social equity. |
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