The IMF and a Renewed Birth of Multilateralism : A response to 'Global Governance after the Financial Crisis: A New Multilateralism or the Last Gasp of the Great Powers?'

 

In 'Global Governance after the Financial Crisis: A New Multilateralism or the Last Gasp of the Great Powers?' in this journal, Ngaire Woods discusses what appeared in the wake of the global financial crisis to be a renewed birth of multilateralism in the governance of global economic issues, and concludes that it was only the last gasp of the G7 whose influence may have become diluted somewhat but paradoxically preserved by the G20.

Woods' exclusive focus is on the International Monetary Fund (IMF), though the word IMF is conspicuously missing from the title of the article. Perhaps she is using the IMF as a case study – an exemplification of what multilateralism represents. Her comprehensive but succinct review of the recent reforms of the IMF is timely and useful. Her conclusion that the recent reforms are not sufficient to win back the confidence of major emerging market economies is difficult to disagree with. Equally reasonable is her assessment that, as long as the IMF remains less than fully representative, it will continue to have only a limited role to play in the global economy, alongside national and regional strategies. Her analysis of three contrary forces at work that are constraining the IMF to stay as it is – borrower dependence, financial independence and lender dependence – is insightful (though only academic).

Multilateralism can mean different things to different people. In the specific context of the article, Woods seems to equate multilateralism sometimes with an independent IMF but on other occasions with a more representative IMF. They may or may not be the same thing, depending on how one defines multilateralism. The IMF remains a machinery of global cooperation, regardless of whether it is independent or more representative. But representativeness is another difficult concept to define.

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