saving multilateralism
TRANSCRIPT
-
8/9/2019 Saving Multilateralism
1/43
p a p e r s e r i e s
saViNG MULTiLaTeraLisM
RENOVATING THE HOUSE OF GLOBAL ECONOMIC GOVERNANCE
FOR THE 21STCENTURY
JeNNifer HiLLMaN
The German marshall Fund oF The uniTed sTaTes
-
8/9/2019 Saving Multilateralism
2/43
2010 Te German Marshall Fund of the United States. All rights reserved.
No part of this publication may be reproduced or transmitted in any form or by any means without permission in writingfrom the German Marshall Fund of the United States (GMF). Please direct inquiries to:
Te German Marshall Fund of the United States
1744 R Street, NW
Washington, DC 20009
1 202 683 2650
F 1 202 265 1662
Tis publication can be downloaded for free at http://www.gmfus.org/publications/index.cfm. Limited print
copies are also available. o request a copy, send an e-mail to [email protected].
GMF Paper Series
Te GMF Paper Series presents research on a variety of transatlantic topics by sta, fellows, and partners of the German
Marshall Fund of the United States. Te views expressed here are those of the author and do not necessarily represent the
view of GMF. Comments from readers are welcome; reply to the mailing address above or by e-mail to [email protected].
About GMF
Te German Marshall Fund of the United States (GMF) is a non-partisan American public policy and grant-making institu-
tion dedicated to promoting greater cooperation and understanding between North America and Europe.
GMF does this by supporting individuals and institutions working on transatlantic issues, by convening leaders to discuss
the most pressing transatlantic themes, and by examining ways in which transatlantic cooperation can address a variety of
global policy challenges.
Founded in 1972 through a gi from Germany as a permanent memorial to Marshall Plan assistance, GMF maintains a
strong presence on both sides of the Atlantic. In addition to its headquarters in Washington, DC, GMF has seven oces in
Europe: Berlin, Bratislava, Paris, Brussels, Belgrade, Ankara, and Bucharest.
About Brussels Forum
Brussels Forum is an annual high-level meeting of the most inuential American and European political, corporate, and
intellectual leaders to address pressing challenges currently facing both sides of the Atlantic. Participants include heads of
state, senior ocials from the European Union institutions and the members states, U.S. Cabinet ocials, Congressional
representatives, Parliamentarians, academics, and media. For more information, please visit www.brusselsforum.org.
-
8/9/2019 Saving Multilateralism
3/43
Savg Multlatalsm
Renovating the house of global economic governance for the 21st century
Bussls Foum Pap Ss
Mach 2010
Jennifer Hin*Te Gern Mr Fnd f e Unied Se
Inrdin: Cin wi Cexiy 3
Sid Fndin: Te Ariere f Gb Eni Gernne 6
Te Gre Reein nd e Seerin Ciee f e Wrd Eny
Te IMF, Wrd Bnk, nd WTO: Fr Crii Refr 5
Grdin f Gb Finne: Te Inernin Mnery Fnd 7
Fr Renrin Deeen: Te Wrd Bnk
Neiin e Re: Te Wrd Trde Ornizin 4
Renin e He f Gb Eni Gernne fr e Cenry 7
Te Hrbiner f Gb Gernne: Pii Lederi nd e G 8
Reffirin Mieri in Wrd f Reini 3
Trnni Mieri fr e Cenry 33
Cnin 37
Bibiry 38
*Jennifer Hin i enir rnni few e Gern Mr Fnd f e Unied Se nd rren eber f e Wrd TrdeOrnizin Aee Bdy Preiy, e ered iiner e US Inernin Trde Ciin nd ener ne ndief exie neir e Offie f e US Trde Rereenie Te r wd ike nk Je Ginn, Rn Bin, Dn Prie, PeerSrdin, Debr Seer, nd Ki Sinen fr eir e wi i er
-
8/9/2019 Saving Multilateralism
4/43
-
8/9/2019 Saving Multilateralism
5/43
Savg Multlatalsm
Rovatg th hous o gloal coomc govac o th 21st ctu3
The long-term
trend toward
increasing
complexity
combined with a
waning faith in
multilateralism
and multilateral
institutions
makes it nearly
impossible to
reach traditional
binding
multilateral
accords.
Introduction: Coping with Complexity
L Deeber, e eye f e wi ke in inernin ffir rned Ere
Fir ey ked Gene, fr in e
n-rnnin D Rnd f ier rde
neiin e Wrd Trde Ornizin
(WTO) wd e bk n rk fer yer f
ee Ten berer rned Cenen,
in ee bindin nd reenie
reeen refein ien n e r f
e wrd ernen ddre e rein
b ene f ie ne Tey were
be rey diined Inribed n e fe f
e rin re reeen w deefrrin wi ier ree were
rin inbe f deiery Ined f reeen,
e ie yin n eeiin reen nd in
newer rnd e wrd were f frine
nd diiin, de in r e re nber f
riin nd nenine f e ie
fed; f ner, n e r f e w fe
rinized by e re; nd f nern, fr
e kin fr in e wrd i e
iy re rd wen i rey er
Te fire f ee eein rde frreeenr een eifi rein
reeen in e fredeie e i ke
nd e ii i d been ineed in
dne ef ny qeinin e biiy f e
wrd eder ee b ene, eddin
i n e iniin nd fr were
ebied fr e re f iein ier
in e rein eie rbe
f e enry
Wy did ee eein fi? Mny d ed
e inifin eni rii ine eGre Derein nd e erwein ienifi
nd irni eidene f din ne
r ie wd e wrd eder
e ide eir differene nd re eninf
reeen B i did n en I i n e
rbe re n bi en r ren en Te
fire re reeen n be be een rf n-er rend wrd inreed exiy
in e wrd ke i nery iibe
re rdiin ier bindin rd,
bined wi wnin f fi n e r f
ny nrie in ieri nd ier
iniin
Ti inreed exiy e fr nber
f eii if in inernin reinnd
eeiy in inernin economic rein
e f wi e been nfdin er e
re f dede wie er re f re reenriin Gernen iie nd inernin
rrneen fr eie deiin-kin
e n ke e wi ne in e wrd,
eeiy e i deree f inernin
eni inerin nd inerdeendene Wi
denizin e inree in e nber f
nrie w re yer n e wrd e
we rebnin f b eni wer
nined wi e rie f e BRIC (Brzi,
Ri, Indi, nd Cin) nd e er eerin
rke enie Te e f e Sie
b, nied by rke refr in Cinnd Indi in e 98 nd 99 eered e
rid inerin f e b eny Were
reiy ny b f e wrd in
e Orniin fr Eni C-erin
nd Deeen (OECD) nrie, r f
Lin Aeri nd Aiwere ened in b
eni iiy, ddeny ee eerywere
were br eer in ine wrd eny
bed n ii nd rke
A e r-ee, i ed ifin rde
fw nd ern f frein dire ineen, rie in e nber nd ize f inin
nie nd finni iniin, nd rin
b dend I en rrendin
inree in e eed wi wi d,
ney, nd eny rere e be A
e ir-ee, e re dbin f e
1
-
8/9/2019 Saving Multilateralism
6/43
Th Gma Mashall Fu o th Ut Stats4
The inability
to create new
institutions or
reach agreements
means greater
reliance onand
greater need
for renovation
ofthe existing
international
economic
institutions, the
IMF, the World
Bank, and the
WTO.
b wrkfre d dire effe nwe, ine ee, nd eyen in e
dned indri nrie, in e inne
rin fer f eni ineriy nd
bi bk in bizin
Tken eer, ee fr e reed e
iy f e rren iniin f ier
ernne brekin in, edin
frenin nd e eerene f dee diiin
n r f nrie differen e f
eni deeen Trw in e inree
in e exiy f e ie eee nd ederee wi ee ie er nd ffe ne
ner nd e rbe f e enry bein
k ex nde
Ti er re ernin ere in i
y re ex wrd wi reqire re
ieri, n e I en reer reine
n eer n e eni iniin nd
fr e redy erned fnin in
b finriry e Wrd Bnk,
e Inernin Mnery Fnd (IMF), nd e
WTO I nend rein new inernin
iniin r bindin rd i nery iibe
in dy wrd, nd exine were e exiin
iniin nd dy nd e ne wi be
neery if ey re fr e re f n effeie
b eni riere fr e enry
Sendy, e er exre e rbe reed
by e k f fi in ieri, riry
n e r f ny deein nd eerin
rke nrie, w eier dn wn rey n
e ier iniin deined in byne
er wen e rnni wer dined e
wrd r w find eir eni need n be
re eiy ddreed r bier r rein
reeen rer n wrkin r e fen
Rird B Freen,America Works: Critical Thoughts on theExceptional U.S. Labor Market(Re Se Fndin, 7)
re bere ree e ieree Deie new ieri reiden in
e Unied Se, e en in e wrd f
b ernne dy i in e wrn direin,
be fnd in e ndred f rein, b-
rein, nd bier reeen e e
in fre in e eer dede Wi e
reeen e eenin f e enery,
ie, nd rere ef fr ieri nd
ier iniinn wi e rd f
e e b rbe rein n
e be, ned nd inbe r
rein rrneen
Tird, e er nend , in e bene f
ny re f bidin new b eni
riere, e exiin iniin f ier
eni ernne be rened Teir
ernne rre need be ned refe
e dri if in e diribin f eni
wei n nrie, eir nde reied
in rder enre ey er wider rne f
ie b wi beer erene n e, nd
ey be ded in e fe f riferin
reini, wi if wrd dinnd inrrin rein rd wiin
ier frewrk
Ti er nend wie ee ne
re b dnin nd eeni if e iniin
re e e effiieny, effeiene, nd
eiiy ey reqire, ey re in f we wiin
e r f e rren wrd ye We re
n, in er wrd, in 944 ene
niin-kin e wen e Unied
Nin, n wi e Wrd Bnk, e IMF, nd
e redeer e WTO were reed rey f we Nr d we need be in
en in rder iee b eni
riere be f eein e need f
e enry Te rren rii, e in
eer f wrd eder r e eein
f e G, nd n nderndin f e
-
8/9/2019 Saving Multilateralism
7/43
Savg Multlatalsm
Rovatg th hous o gloal coomc govac o th 21st ctu5
fiin f e rren inernin eniiniin be en e ee
-needed renin f e ye
Finy, ederi wi be needed
fr nrie rnd e wrd, e er
nde by ein e re Ere
nd e Unied Se y if ey re
e e w eer ey red 65 yere iniin f ier eni
rder reed brin b b ee nd
reriy fr , wi ien ink
nd by wen ddrein e
rein eni rbe f e dy
-
8/9/2019 Saving Multilateralism
8/43
Th Gma Mashall Fu o th Ut Stats6
The UN bore
responsibility
for issues of
diplomacy,
security, and war;
the World Bank
for international
development and
the reduction
of poverty; the
International
Monetary Fund for
financial stability
and economic
cooperation;
and the GATT,
precursor to
the World Trade
Organization, for
trade liberalization
and institutional
stability in the
world trading
system.
In 944, in e wd f New Hire, wie end f Wrd Wr II redy in i, n
exrrdinry e f erin rred, brinin
eer n rry f ernen ffii we
iin fr beer fre w ed by e rd
en f e 93 Rejein e ri
ber-y-neibr iie f e jr
eni wer d ened e ide
in wrdwide derein nd wr, ee bi
ern dedied eee ined e
rein f re-bed inernin eni
rder wd ere e bi fr ee nd
reriy Oer e re f e Bren WdCnferene, e beqen Dbrn Ok
nd Sn Frni eein, nd e n
fwed, ey neied f nd reed e
rer fr fr jr inernin iniin
e Unied Nin (UN), e Inernin Bnk
fr Renrin nd Deeen (Wrd
Bnk), e Inernin Mnery Fnd, nd e
Inernin Trde Ornizin (ITO)
A eir inein, e f e jr inernin
iniin yed eified re Te UN bre
renibiiy fr ie f diy, eriy, ndwr; e Wrd Bnk fr inernin deeen
nd e redin f ery; e Inernin
Mnery Fnd fr finni biiy nd eni
erin; nd e GATT, rerr e Wrd
Trde Ornizin, fr rde iberizin nd
iniin biiy in e wrd rdin ye
Tee iniin, wie fr fr erfe, e
dne i eir fnden
In i f e reend rere fr
rnd e wrd re dei rke
Te UN, IBRD (Wrd Bnk) nd IMF e in beinwi ie dey Hweer, e n e ITO wi brd nde d be bndned in 95 wen e TrnAdinirin nnned i wd n eek rifiin fe Hn Crer de k f r in e US CnreIned, in 947 er r f nrie neied eGener Areeen n Triff nd Trde (GATT), wi wrnfred in 995 in e Wrd Trde Ornizin (WTO)
nd jb, e GATT/WTO nd i re nddiiine e ke n brek f Derein-
er reini by fr f enry, nd
ei rnd f ier rde neiin
e reed in widered iberizin f
rde e in indri rd n
indri nrie Te UN, wie n iein
e ie f brinin n end wr,
dne nin rie, ee rein
nfi, n eekeein iin, erdie
diee, nd wrk reeen n eeryin
fr n ri nenin e e f e
ebed nd f er e Siiry, e WrdBnk, wie n eiinin ery, een
e rin f e wrd in iin in
ery deine fr 4 eren yer
eren dy, n wi ridin n nd
deeen ine in re n 6 nrie
nd riiin in iniiie n eeryin
fr bin HIV/AIDS bidieriy
edin nd deb reief fr e re nrie
Te Bnk i rify ended fr i biiy
rie nd nne rere fr deeen,
fr i iy-rined ff, nd fr i de f
knwede b deeen reie ndre r nry bndrie3 Te
IMF, wie i eed niderby fr i
inii dy f nirin derene e r
e ye f fixed exne re, de
irn ne i key inren
reine, endin, nd eni ine
win i nin nber f finni rie,
nine nein endin were neery,
nd jin e fi in exree ery4
3 Rewerin e Wrd Bnk fr e Cenry Report ofthe High-Level Commission on Modernization of World BankGroup Governance (e Zedi Ciin Rer), O9, 9
4 Rdri de R, frer nin direr f e IMF ke iew befre e 8-9 finni rii fndenrefr e IMF w n needed, rin e IMFd eed er i 6 yer r enden i keyinren wie reinin re i re f ferininernin eni erin, rin riin reriynd ferdin b finni biiy Rdri de R, Ie IMF Mnde Si Reen? Global Agenda, Jn 5
Solid Foundations: The Architecture of
Global Economic Governance2
-
8/9/2019 Saving Multilateralism
9/43
Savg Multlatalsm
Rovatg th hous o gloal coomc govac o th 21st ctu7
Fr eir r, e Unied Se nd e ebere f e Eren Unin e been n
e ie nd ened riin in
ee iniin Ti i nrriin, ien
e re e rnni rner yed in
rein ee iniin nd e inere ey
were riiny inended ere A b,
e wr b eni riere w
ebied en ie e We eer
in e eerin Cd Wr nex r eiberizin f inernin rde nd i
fw Fir r e iniin f e Bren
Wd ye, nd en r e Mr
Pn, e Unied Se w be rebid e
ered rdin iy nd finni
rke f Weern Ere Fr e Unied Se,
e erridin re w er: e ii-
rei need bid bwrk in
Table 1. The architecture of global economic governance
International Monetary Fund(IMF)
World Bank World Trade Organization (WTO)
Began with: 44 members
Now: 186 Members
Began with: 44 members
Now: 186 Members
Began with: 23 GATT parties
Now: 153 Members
Mandate:
Promotes international
monetary cooperation
Macroeconomic surveillance
Promotes exchange stability
Develops multilateralsystem of payments
Makes resources available
to members experiencing
balance of payments
difficulties.
Mandate:
Evolved from facilitator of
post-war reconstruction and
development to mandate of
worldwide poverty alleviation
Promotes long-term
economic development
by providing technical and
financial support
Funds loans through
member country
contributions and bond
issuance
Mandate:
Forum for trade negotiations
Handles trade disputes
through dispute settlement
process
Monitors and implements
trade agreements
Technical assistance and
training for developing
countries
Cooperation with other
international organizations
Revenue: $325 billion in quotas
contributed by members (as of
3/09)
Revenue: In 2009, IBRD raised
$44.3 billion. In FY 0911,
commitments of $41.7 billion
made available to IDA
Revenue: Administrative
budget of $173 million, paid
by contributions from members
based on a share of world trade
Loans or grants: $175.5 billion
in loans committed, of which
$124.5 billion not drawn (as of
9/09)
Loans or grants: $58.8 billion
in total commitments (loans,
credits, guarantees, and grants)
in 2009
Loans or grants: $28 million
of training and technical
assistance provided; support for
Aid for Trade initiatives
Source: IMF, World Bank, WTO websites
-
8/9/2019 Saving Multilateralism
10/43
Th Gma Mashall Fu o th Ut Stats8
Cni B i ered US enief-inere: inifin rin f Mr Pn
id effeiey wen b Eren dend
fr d fr e Unied Se, ein e
ff dei fer f wr r renew
f e Gre Derein Oer e edi er,
e Bren Wd ye eed ree frein
rke fr e Unied Se by njrin
idde in US eni rner rnd e
wrd, ein fr wi e Eren
ne ey were bk n eir fee fwin e
Mr Pn nd e renrin rr
f e Ornizin fr Eren EniCerine been be benefi
Tdy, by wy f irin, nery ne-ird f
US nd EU exr re deein nrie
were e Wrd Bnk endin rr
By eer ebiin e re nd ndrd f
nd by wi e b eny i erned,
e Unied Se nd Eren Unin bee
e ewrd f e inernin eni rder,
rnnin e ye fr f e wr
er In rern, e ree ir f e b
eni riere ey ebiederine finni ide f enie (IMF), rde in
d nd e re ide f enie (GATT/
WTO), nd inernin deeen nd
ery eiin (Wrd Bnk)e deiered
enr eni benefi eir fnder
Deie in ene, e ye
fred we I rided biiy nd rke
enin, reiey be frein exne re,
e redy ibiiy f i, nd fr fr e
rdinin f reni iie Beween
e fir GATT rnd in 947 nd e n f e
D Rnd e WTO in , inerninrde inreed enry, by re n fd
Gb finni fw e rwn by i reer
n Te inerin f e wrd eny
reeded e, reed by freed fi een, e deeen f new nd
exndin rke, enie f e, eer
re f y f rw eri nd finied
d, e inernin irin f br, nd
eni dne in rdin ree,
rnrin, nd niin
Te ey f i iry i e Unied
Se nd Ere enjy ized nr e
Bren Wd iniin B benefi fr e
nwrien re e reiden f e Wrd Bnk
i wy n Aerin, wie e nin direrf e IMF i wy Eren Seen f e
en nrie re errereened e IMF
(in er f e differene beween eir IMF q
re nd eir re f wrd GDP) re Eren
B e Wrd Bnk nd e IMF e brd f
4 exeie direr, wi f e exeie
direr ekin fr (nd in fr) r
f nrie Fie nrie, weer, e eir
wn ined e: e Unied Se, Gerny,
Frne, e Unied Kind, nd Jn In
ddiin e Gern, Fren, nd Brii e,
e 4 er eber f e Eren Unin re
r f e r f nrie rereened by een
er exeie direr, ereby iin Ere
ree exie e nd inifin reene in
een er A , e EU eber e n
infene 3 eren f e e e IMFnd
iir ( n exy eq) nber
e Wrd Bnk A e WTO, e Unied Se
nd Ere e rdiiny de w f
e -ed qd nrie (e Unied Se,
Eren Unin, Cnd, nd Jn) fr
n ie were iewed e deker fr nyrde reeen, wi e re f wrd w
exeed iy in n
The legacy of this
history is that
the United States
and Europe enjoy
outsized control at
the Bretton Woods
institutions.
-
8/9/2019 Saving Multilateralism
11/43
Savg Multlatalsm
Rovatg th hous o gloal coomc govac o th 21st ctu9
Under-represented Countries Over-represented Countries
-6.00 -5.00 -4.00 -3.00 -2.00 -1.00 0.00
China
United States
India
Brazil
Mexico
Turkey
Russia
Iran
KoreaSpain
Indonesia
United Arab Emirates
Poland
New Zealand
Japan
Romania
Thailand
Slovak Republic
Bangladesh
Morocco
KazakhstanGreece
Nicaragua
Czech Republic
Colombia
Saudi Arabia
Germany
Belgium
France
Netherlands
United Kingdom
Switzerland
Canada
VenezuelaSweden
Denmark
Italy
Norway
Austria
Kuwait
Libya
Iraq
Nigeria
Singapore
Finland
Ireland
MalaysiaChile
Zambia
Algeria
0.00 1.00 2.00
Difference between IMF
Quota Share and Share
of World GDP (%)
Non-EU States
EU Member States
Figure 1. Under- and over-representation at the International Monetary Fund
Notes: 25 IMF members with the smallest and largest differences between IMF quota share and share of world GDP. GDP is adjusted
for purchasing power parity (PPP).
Source: Rebecca Nelson, The G20 and International Economic Cooperation: Background and Implications for Congress,Congressional Research Service, Dec. 9, 2009.
-
8/9/2019 Saving Multilateralism
12/43
Th Gma Mashall Fu o th Ut Stats10
Wi e brin f e in bbbe in eUnied Se in 7 nd e rin f een
ed e debiizin f e b finni
ye, e wrd eny ed in
ee reein in e fin qrer f 8, wi
b re GDP drin 6 eren nn
re Ti i ndbedy e re deine in
wrd nd eeiy in wrd indri
rdin nd wrd rdef e wr er
Wrdwide exr eed fr $6 riin
in 8 $ riin in 9, dr f er 3
eren Viry nrie were ked in
e dwnrn, wi e wrd winein e firinifin deine in wrd re GDP (f nery ne
eren) in ix dede
Te f ry f wy i e rred i
i bein wrien, b i r wi f n
deeen in e Unied Seeeiy e
exnin nd beqen e f e re ee
nd re ee finnin bbbe nd i i n
n ereered US nd b finni ye
Add e e e n f erieny ey
nery iie, ery w inere re nd
inere re red, nd ener direrd frwin rik in e finni ye, nd e key
e bein e in f Oer wd
in e rren n in nd reere
in in Ai, riry Cin, nd
e irrr-ie defii in e Unied Se
ner jr nderyin e f e rbe
Ti Gre Reein f 89 eed e
inernin eni iniin neer befre
In rene, e IMF eed i re
ender f rer, ridin finni r
ke (n er) Iend, Ukrine,Hnry, Pkin, Ber, Serbi, Areni, E
Sdr, nd Li, nd exended redi
Mexi, Pnd, nd Cbi nder new
fexibe redi ine In rder beer eqi e
Fnd fr i k, G eder eir Lndn
i in Ari 9 eded rie e IMF
endin iy $75 biin Addiiny,ey red e Fnd inenify i eni
reine nd ery wrnin ye
Te Wrd Bnk ed exnd
nd eed endin, ine, nd die
deein nrie, iin rerd i f
nery $6 biin nrie i by e finni
rii in fi yer 9n inree f 54 eren
er e rei yer An ddiin $83 biin
w biized r f e Wrd Bnk b
rii rene iniiie een e i f
e rii n e nerbe, eeiy inw-ine nrie Tee iniiie f
n fey ne rr re e
nerbe, ininin n-er infrrre
ineen rr, nd n inin e
eni fr rie er-ed eni rw
nd eyen rein, riry r e
r f nd edi-ize enerrie
Te WTO fr i r ben new nirin
nd rerin eni n reini in
ken by WTO eber nd wrked enre
rke reined en nd nrie
dered eir WTO ien Te WTO
ed G eber kee eir ede f
r fr Aid fr Trde iniiie nd wrked
enre rde finne reined ibe nd
ffrdbe
Te end jr yei rene e Gre
Reein been e rnfrin f e
ie-knwn G erin f finne inier
nd enr bnker in n ffir inin
ed f e, dered by ee eder be
e reier fr fr inernin eni
erin5 Te G red in 999 in e
wke f e 997 Ain finni rii fr
br eer finne inier fr
5 Te Pibr Si: Leder Seen, rr 9We deined e G be e reier fr fr rinernin eni erin
The Great Recession and the Steering
Committee of the World Economy3
The second
major systemic
response to the
Great Recession
has been the
transformation of
the little-known
G20 into the
premier forum
for international
economic
cooperation.
-
8/9/2019 Saving Multilateralism
13/43
Savg Multlatalsm
Rovatg th hous o gloal coomc govac o th 21st ctu11
jr dned nd eerin enie wie f biizin b finni rke
Wi i endny r f e rene e
Gre Reein, i nw ned e G7/
G8 eein e ief eerin iee f
e wrd eny6 Te inin in e G
f nber f nrie beynd e iri
G7/G8 rin n db eed, e in
r, fr reniin f e rwin wer f
e eerin rke nd deein nrie,
w nw n fr re n 4 eren
f e wrd eny T e ny ene f
eiiy r e wrd nd riryn e eerin rke enie,
exnin f e ederi ire w rii
Hweer, e inii G Leder Si, ed in
Winn in Neber 8, w ein f
n EU-US jin enre Brii Prie Minier
Grdn Brwn d been in fr Bren
Wd II eey reie b eni
ernne, nd e Unied Se rended by
rin e ide f G erin, eeed
e ee f ed f e, nd exended e
iniin fr n inii eein in WinnEren eder fir exibied differene f
iewin n i r, wi Fren Preiden
Ni Srkzy needin be nined f e
rriene f e G ene, ien
EU eber e d fr f e een e (57
eren) e G7 b ny e e fr e
ne fr e Eren Unin (5 eren)
e G B in e end ere w ene
f e G e ny ibe fr wi e
e f eberi reqired dee ide,
re nen n eir deirbiiy, nd wrk
ieen e
6 C Fred Beren, Peern Inie fr InerninEni, A Berin fr Gb Lederi in e Tweny-Fir Cenry, Keyne See e Gb Hn RereFr, Se, Kre, N 4, 9
Te ein f e G ed n einin e Eren r i Effr
were de rir nd fer e eein e
Ere-wide iin, wi e Eren
Cni din nber f rinie fr in
were reeen d be reedriniy
in e re f ennin nd rein nd
refrin e inernin finni iniin
Te Eren Ciin w ien e k f
deein r fr reenie refr
f e finni ye, wi were en endred
by e Eren Cni nd red n e re
f e G eder by Eren ed f eTr ee effr, Ere needed find
n rnd n ein iin, wi
e Unied Kind rin fr re i
fr er ernen, Gerny eizin
e need id jr bde defii, nd Frne
in fr jr dwn n exeie
enin nd ener ienin f finni
rein Te Unied Se jined e Unied
Kind nd Jn in in fr re i
fr er wie iniiy reiin ny if f
finni rery iy f e nd f
nin rer
W eered fr ee G i i firy
rerkbeb in er f e bne f
e nen w reed nd in er f
e re Deie rky differin iew n
w ie eni rw nd reery,
reeen w reed re n $
riin in e b enybei r
e IMF, rer n indiid nriein e
fr f $5 biin in new endin iy, $5
biin in new Sei Drwin Ri, nd $5
biin in rde finne Serey, e G ered ien by indiid nrie fr fi
exnin wd $5 riin er w yer
Dend fr e Eren nrie fr
jr enin f e rein nd eri f
finni iniin were e r e rein
The inclusion
in the G20 of
a number of
countries beyond
the historical
G7/G8 grouping
partly stems from
a recognition
of the growing
power of the
emerging marke
and developing
countries, who
now account for
more than 40
percent of the
world economy.
-
8/9/2019 Saving Multilateralism
14/43
Th Gma Mashall Fu o th Ut Stats12
G20 member countries
EU countries not
individually represented
in G20
Not members of G7
Legend
G7 member countries
Not members of G7
Legend
Table 2. Numbers count: From the G7/G8 to the G20
G20/G20 + non G8 EU
Country GDP (millions
of dollars)*
% of world
GDP
Argentina 324,767 0.53%Australia 1,013,461 1.66%
Brazil 1,572,839 2.58%
China 4,327,448 7.10%
India 1,206,684 1.98%
Indonesia 511,765 0.84%
Mexico 1,088,128 1.79%
Saudi Arabia 469,426 0.77%
South Africa 276,764 0.45%
South Korea 929,124 1.53%
Turkey 729,983 1.20%
Subtotal 12,450,389 20.44%
G20 total 46,512,592 76.35%
EU (27)1 18,387,785 30.18%
G20 + non-G8
EU countries2
53,366,428 87.60%
1 EU 27: Austria, Belgium, Bulgaria, Cyprus, Czech Republic,
Denmark, Estonia, Finland, France, Germany, Greece, Hungary,
Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands,
Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden,
United Kingdom.
2 Non-G8 EU members: Austria, Belgium, Bulgaria, Cyprus, Czech
Republic, Denmark, Estonia, Finland, Greece, Hungary, Ireland,
Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland,
Portugal, Romania, Slovakia, Slovenia, Spain, Sweden.
Source: G20 website; www.g20.org
G20 Members
G7/G8
Country GDP (millions
of dollars)*
% of world
GDP
Canada 1,499,551 2.46%
France 2,866,951 4.71%
Germany 3,673,105 6.03%
Italy 2,313,893 3.80%
Japan 4,910,692 8.06%
United
Kingdom
2,680,000 4.40%
United States 14,441,425 23.71%
G7 32,385,617 53.16%
Russia 1,676,586 2.75%
G8 34,062,203 55.92%
EU countries
in G8
11,533,949 18.93%
* 2008 GDP
Source: IMF World Economic Outlook Database (Oct. 2009)
G7 Members
Source: G20 website; www.g20.org
EU G8: France, Germany, Italy, United Kingdom.
-
8/9/2019 Saving Multilateralism
15/43
Savg Multlatalsm
Rovatg th hous o gloal coomc govac o th 21st ctu13
f Finni Sbiiy Brd (FSB)7
Te FSBw deined brin b reer rdinin
nd ere f rery ye inde
ede fnd, rinie n y nd enin,
nr n exeie bnk eere nd bnk
erey, nd eri f nin ndrd nd
redi rin enie Te in fr Bren
Wd II nd rein f e iniin f
ier eni ernne were e
e fwy: ere w een reeen n e
US r inree e IMF q re f
e eerin rke nrie by fie erene
in, n wi n inree in e in werf deein nd rniin nrie e Wrd
Bnk f e ree eren nd ien
refr e nde, e nd ernne f
7 Te Finni Sbiiy Brd w ebied e LndnG Si er e Finni Sbiiy Fr,wi w reed in 999 by e G7 finne inier ndenr bnker fr re rdinin ndinfrin exne n e renibe fr finnibiiy Te FSF w de f finni rer fr eG7 nrie, Ari, Hn Kn, Neernd, Sinre,nd Swizernd, we inernin finni iniin,inernin rery nd eriry rin, iee
f enr bnk exer nd e Eren Cenr BnkWen e G eder rnfred e FSF in e FSB, eyexnded i eberi inde 64 riin Gnrie, Hn Kn SAR, e Neernd, Sinre,Sin, Swizernd, e Eren Cenr Bnk, nd eEren Ciin Tey inifiny exndedi nde inde een f nerbiiie in efinni ye, nirin rke deeen, diinn be rie in eein rery ndrd nd eebien f ideine nd r fr eriryee US Trery Serery Tiy Geiner deribede FSB fr ir e riere f erinebied fer e end wrd wr referrin eIMF, e Wrd Bnk nd e WTO, nin i exein e FSB wi e i b finni ndrd ndd FSB eber nbe e ndrd
e finni iniin, wie Ere deire kee e nber f e n e Exeie Brd
f e IMF nd e Wrd Bnk 4 w e Te
WTO w inded in e er G eein, nd
w ien e k f nirin G ede n
ke ny reini in nd ee e
D Rnd f rde neiin8
A ern ben eere fr e G i
wereby e ed f e wd in k
e ier eni iniin reed
eifi ie, wi inrin rer bk
e nex eein f G eder Wie erene e inii Winn i w n
ireie, wi rke rnd e wrd fin
inifiny fer i nin, e in
by e ier iniin nd ernen
rry eir ined k red ke
e, e rein e beqen i
w re iie A f inere i e
eerin re by wi direeen n,
fr exe, jr Eren yer ike Gerny,
Frne, nd e Unied Kind, r beween
Ere nd e Unied Se, were brkered by
er G eber, wi Indi r Cin r Brzierin i re f referee nd niir
8 Te WTO re rere nd reribed iriiy ern nrin n i biiy effeiey ne nd eeber fr din reini ere A nber findeenden nir, rineny Gb Trde Aer(GTA), wwwbrdeerr, e eed in nyzereini ere in brder definiin f wnie reini in Wi rerd e G ede refrin fr riin new brrier ineen r rdein d nd erie, GTA fnd , n ere, Geber d brken e n-reini ede eery reedy in e yer fwin e Winn Leder Si
-
8/9/2019 Saving Multilateralism
16/43
Th Gma Mashall Fu o th Ut Stats14
Table 3. G20 leaders summits: Pledges and commitmentsG20 Leaders
Summits
Pledges/Commitments
Washington,
November 2008
Adopted 5 principles for reform relating to transparency, accountability, and enhancedregulation of f inancial markets, products, and participants, including credit rating agencies,with an action plan for their implementation
Pledged to coordinate regulatory reforms internationally
Committed to reform Bretton Woods Institutions to reflect changed economic weights in theworld economy, but no specifics
Pledged to use expansionary macroeconomic policies, both fiscal and monetary, to stimulateaggregate demand and encourage economic growth
Committed to refrain from protectionist trade policies and to strive to reach agreement on
the Doha Round of WTO talks.
London,
April 2009
Reiterated commitments of 2008
Creation of Financial Stability Board (FSB) as successor to Financial Stability Forum with allG20 countries, FSF members, Spain and the European Commission as FSB members, set upto establish and enforce high global standards for financial regulation and monitoring
IMF: Pledge to increase funding for the IMF and MDBs by $ 1.1 trillion, including a tripling ofthe IMFs lending capacity by restocking the IMF with $500 billion and creating $250 billion ofnew Special Drawing Rights.
World Bank: support for increase in lending of at least $100 billion and implementation of2008 reforms
Commitment to conclude an ambitious Doha Round and to avoid protectionist measures
Pittsburgh,
September 2009
Agreed on a Framework for Strong, Sustainable and Balanced Growth to coordinate
and monitor national economic policies to correct the current global imbalances andprevent future such imbalances, with some peer review and some IMF oversight of thismacroeconomic policy coordination
Specific plans to increase the representation of emerging-market countries at the IMF byincreasing their quota by five percentage points to 43% of the total and similar initiatives atthe World Bank
Commitment to crack down on financial institution excesses, including raising capitalstandards, implementing international compensation standards and adopting frameworks forcross-border resolutions of failed institutions
Commitment to conclude the Doha Round by the end of 2010
Participants Washington: Argentina, Australia, Brazil, Canada, China, France1, Germany, India, Indonesia, Italy,Japan, Mexico, the Netherlands2, Rep. of Korea, Russia, Saudi Arabia, South Africa, Spain2,Turkey, United Kingdom, United States
Ex-officio participants: European Commission (President), World Bank (President), SecretaryGeneral of the UN, IMF (Managing Director), Financial Stability Forum (Chairman)
London: All Washington participants plus Czech Republic3 and ex-officio participants: Chair ofNew Partnership for Africas Development (NEPAD), Chair of Association of Southeast AsianNations (ASEAN), WTO (Director-General)
Pittsburgh: All participants from London with Sweden3 representing the EU Council rather thanthe Czech Republic
1 Representing EU Council and themselves2 Permitted extraordinary presence3 Representing the EU Council
Source: G20 website, www.g20.org
-
8/9/2019 Saving Multilateralism
17/43
Savg Multlatalsm
Rovatg th hous o gloal coomc govac o th 21st ctu15
Wi e eie we f eni rii i e wrdfr e Ain edwn in 997
Ri rbe rii in 998 e e f
Arenin in 999 nd ere been
beqen rren f nd-wrinin, -re
nyi, nd fr refr e riere
f b eni ernne in rder eed
reery nd reen rie fr rerrin
Eqy ein been we f redie
fr e ni in e Indin Oen Hrrine
Krin in 5 e endrin ery r
f Afri e eed e wrd
biiy rend, nied by fr beer r deeen nined in
ny beein bk r rinen iin
rer On e rde frn, e WTO k ener
e n n fer i rein, wen rer
nbered deee i Minieri eein
in See in 999, ein reeden fr ii
dirbne eein f e WTO, IMF, nd
Wrd Bnk eer ine Oer, e rin
fr refr reed reend wi e Gre
Reein f 8-9, wi red
nber f ede fr ii eder ern
fr e ike f e nd refr eb eni riere ee e ene
f e enry
Te ri fr refr e in-ined
rbe f reene, effeiene, nd eiiy
Wnin relevance in e e f e IMF been
deeed re f e endne f rie
i rke; e Wrd Bnk, re
f e rie f Cin nd er new eni
wer enin in infrrre deeen;
nd e WTO re f e riferin f
rein rde reeen Wnin effectiveness e IMF i i direed e Fnd inbiiy
ke b ibne nd i iin
ree in bi; e Wrd Bnk i been
idenified in rein e inbiiy bniy
ire ery re, riry in Afri, rdeqey ddre enirnen, n ri
r rrin nern, n wi ereied
iin ree; nd e WTO i rien fr
e inbiiy nde e D Rnd deie
e nine yer e ed ine k ben
in Neber Finy, wnin legitimacy
been dined b e IMF nd e Wrd
Bnk re f e k f in wer r
q ee ed by eerin nd deein
nrie nd e erein e iniin
re nred by ndf f wey nrie
ie ndiiniy n er b neee; e WTO, i rie fr ereied
k f rnreny in i erin bined
wi nern e nen-ny deiin
kin re y be ein in wy f rein
nin, nd fr nndin fire
enre e benefi f free rde re re
eeny diribed9
9 M wrk n refr r d been dne we befree G Si See, fr exe, Wrd Trde Ornizin
(4), The Future of the WTO: Addressing InstitutionalChallenges in the New Millennium: Report of the ConsultationBoard to the Director-General Supachia Pantichpakdi(eSernd Rer); nd e rer f e IMFIndeenden Ein Offie, Governance of the IMF: AnEvaluation, 8 In ddiin e wrk f iin,ere e been ne bk nd rie wrien, ny fwi re ned in e bibiry e end f i rie Keyn e wd be Losing the Global Development War, JnW Herd, 8; Reforming the IMF for the 21st Century, EdwinM Trn, 6; Redesigning the World Trade Organization
for the 21st Century, Debr P Seer (); Studies of IMFGovernance, Rben Ldny nd Lenrd Diz Mrinez(9); The IMF and its Critics, (4) nd The World Bank:Structure and Policies () Did Vine nd CrierGiber; Refrin e Wrd Bnk, Jei Einrn,Foreign Affairs, Jn/Feb 6, V 85, Ie , nd The IMF,
World Bank and Policy Reform, Aber Pni nd MriziZnrdi, Rede Sdie in Deeen Eni, 6In ddiin, nber f r e been fred deed refr f ee iniin, indin Te Bren WdPrje (wwwbrenwdrjer), New Re fr GbFinne Ciin (wwwnew-rer) nd Te Fr Pir(wwwfrirr)
The IMF, World Bank, and WTO:
From Crisis to Reform4
The various calls
for reform have
focused on a
perceived lack
of relevance,
effectiveness, an
legitimacy at the
IMF, the World
Bank, and the
WTO.
-
8/9/2019 Saving Multilateralism
18/43
Th Gma Mashall Fu o th Ut Stats16
I i in e fe f ee ene Geder e ed fr refr e inernin
finni iniin Tee refr wi ririy
f n ne eir nde, e, nd
ernne refe e inrein exiy in
e wrd nd ne in e eni wei f
e ri yer In ddiin, e refr wi
ine reer rdinin nd erene
n e ree eni iniin, n wi
e newy reed Finni Sbiiy Brd
Iii in ri fr refr i reffirin f r by e G eder fr
ier r eni rbe
nd fr inreed reine n e ier
eni iniin e e e S
inree wi neeriy ine findin wy
ierize ny f e exiin rein
reeen in e e f e wrk
f ee iniin Eqy iii in e G
eder een i r fr e nin wrk
f ee exiin iniin f b eni
ernne
In the wake of the Second World War, it was America that largely built a system of
international institutions that carried us through the Cold War. Leaders like Harry
Truman and George Marshall knew that instead of constraining our power, these
institutions magnified it.
Today its become fashionable to disparage the United Nations, the World Bank, and
other international organizations. In fact, reform of these bodies is urgently needed
if they are to keep pace with the fast-moving threats we face. Such real reform willnot come, however, by dismissing the value of these institutions, or by bullying other
countries to ratify changes we have drafted in isolation. Real reform will come because
we convince others that they too have a stake in changethat such reforms will make
their world, and not just ours, more secure.
Then-presidential candidate Barack Obama
The Chicago Council on Global Affairs
April 23, 2007
-
8/9/2019 Saving Multilateralism
19/43
Savg Multlatalsm
Rovatg th hous o gloal coomc govac o th 21st ctu17
Mission
Te rini inernin iniin ined
in finni biiy nd finne er i e
Inernin Mnery Fnd Te Fnd
eed niderby fr i riin re, wi
fed n neen f e r e ye
f fixed exne re Wen e Unied Se
eiined derene e d ndrd nd
e ye f eed exne re in 97,
nrie were ef free e eir exne
re reie nd e IMF rer w rdiy
ended, in i f eiy n ebernrie wi erien bne-f-yen
rbe nd n rendin rie reen
e inernin nery ye we Te
Fnd e w fndeny ered by
e eerene f newy indeenden nin in
Afri nd eewere beinnin in e e 95,
fwed by ner we f new enrn fer
e end f e Cd Wr, b f wi reqired
ne in finnin nd iy die r
rw-riened rr refr nd rniin
fr enry-nned rke enie
Te IMF rreny rrie i iinr binin f finnin (yiy
dne r nd-by rrneen r ei
n), reine f nrie eni nd
finni iie, eni ine, nd iy
endreen
Governance
B e IMF nd e Wrd Bnk e Brd
f Gernr de f rereenie f
86 nrie wi ee wie yer
Te IMF Brd f Gernr i died by
w inieri iee, e Inernin
Mnery nd Finni Ciee (IMFC),
nd e Deeen Ciee Wie e
eifi wer reide wi e Brd, e re
neen f e IMF i dne by i Exeie
Brd f 4 eber, fie f w re ined
(e Unied Se, Jn, Gerny, Frne, nde Unied Kind), ree f w re eeed
by ine nry (Cin, Ri, nd Sdi
Arbi), nd 6 f w re eeed rereen
r f nrie, n wi e nin
direr f e IMF, w ere e irn
f e Exeie Brd Oer nd be e
inee f Gerny, Frne, nd e Unied
Kind, e reinin eber f e Eren
Unin re rereened n e Exeie Brd
in ne f een differen nry rin E
eber f e Exeie Brd nr re
f e e e IMF, deendin n e izend ee f riiin f e nrie in i
r er r Te Unied Se e re
ine in re wi 677 eren, fwed
by Jn (6 eren), Gerny (588 eren),
Frne (485 eren), nd e Unied Kind
(485 eren) Wie ny deiin e
Exeie Brd re de n e bi f jriy
re, e key deiin reqire er-jriy
e f 85 eren, wi ie e Unied Se,
wi i 677 eren re, e biiy bk
deiin If e ree ined Eren
rereenie ed eer, ey wde re n 5 eren f e e nd wd
e, ike e Unied Se, en wer
e ny in reqired erjriy
e f 85 eren Wie e IMF q re
re iy ded, ee de e
n reed in bni if in wer wy
fr errereened Ere nderrereened
eerin rke enie
Wi ree reen ernne refr effr
e Fnd, Mnin Direr Diniqe Sr-
Kn reed fr ir r refr,in fr rer fr e IMF Indeenden
Ein Offie, fr n inern Wrkin Gr
Indin e nin direr, ere re rreny Eren (4 eren f e ) erin n e IMFExeie Brd
Guardian of Global Finance:
The International Monetary Fund5
-
8/9/2019 Saving Multilateralism
20/43
Th Gma Mashall Fu o th Ut Stats18
n IMF Crre Gernne, fr ii ieyrnizin, nd y fr e Ciee n
IMF Gernne Refr eded by S Afrin
Finne Minier Trer Mne A e Fnd
inern rer ned, diifin wi Fnd
ernne we re-de e rii, refein
ene f wnin reene (ien endn rie
i rke), effeiene (denred by e
Fnd inbiiy ke b ibne), nd
eiiy (wi iniin rre deribed
ded nd fedii)
In ein ddre e e nern breene nd eiiy, e Mne Ciee
w ebied in Seeber 8 nd ied i
rer n Mr 5, 9, in dne f e rin
eein f e IMF Te Ciee rer ed
fr:
Te rein f i-ee inieri ni
(IMF Cni) fer ii eneen
in rei nd rii deiin;
An eerin f e q nd ie refr
ben in 9 by ifin 7 75 eren
jriy fr deiin, wi wd e eeffe f rein e US e wer wie
iin w ine nrie e biiy bnd
eer e iiie ey d n ike;
A brder nde fr reine inde
reni iie, rdeni ie, nd
finni ier;
Cerer ine f renibiiy nd
nbiiy n ri deiin-kin
eniie in e Fnd wi re riy
fr eber-eifi reine ien neen nd reer rei nd
eriry re fr e Exeie Brd; nd
Inernin Mnery Fnd, IMF GernneSryf Ie nd Refr Oin, Srey Piy, nd ReiewDeren nd e Le Deren, J , 9
Te inrdin f n en, rnren, ndindeenden-f-niniy eein re
fr e Mnin Direr, ereby eiinin
e nwrien re e Mnin Direr
be Eren
Fr i r, e Indeenden Ein Offie
rer, Governance of the IMF, reended:
Crifiin nd erin f e re nd
renibiiie wiin e IMF ernne
rre iniize er nd e ;
Aie nd yei inieri-eeineen in ein rei nd
ereein erfrne;
Rerienin f e Brd wy fr
exeie fnin eriry re
fed n frin rey, nirin
iy ieenin, nd exeriin
exeie eri; nd
Ebien f frewrk d
neen nbe fr i erfrne
Cii iey rnizin, fr eir r,
eized r eir fr ir re
reer need fr rnreny nd niin,
riry wi e exeie direr, n wi
rn fr ne e diribin f in
wer nd q nd inreed nbiiy
fr e exeie brd Tey inied
e eein f e nin direr nd e
deie d be nded i eri-bed,
rnren re wi ny reriin
e niniy f e ndide
Mandate
Wi ree e nde f e IMF, e
rren eni rii ined e need fr
nber f bni ne e nde
f e IMF Tee inde e ebien f
Dissatisfaction
with Fund
governance well
pre-dates the
crisis, reflecting a
sense of declining
relevance (given
ascendant private
capital markets),
effectiveness
(demonstrated by
the Funds inability
to tackle global
imbalances),
and legitimacy
(with institutional
structures
described as
outmoded and
feudalistic).
-
8/9/2019 Saving Multilateralism
21/43
Savg Multlatalsm
Rovatg th hous o gloal coomc govac o th 21st ctu19
nd ery wrnin ye fr renind finni rik, brder reine f
eber reni iie (indin e
Unied Se nd Eren Unin eber e),
er eri f exne re ibne,
nd brd-bed r fr rw in deeinnrie by ein finne ner-yi
endin, bnk reiizin, infrrre,
rde finne, bne f yen r, deb
rer, nd i r
-
8/9/2019 Saving Multilateralism
22/43
Th Gma Mashall Fu o th Ut Stats20
Mission
An e ier iniin, e k
f rin b deeen nd ery
eiin ririy f e Wrd Bnk Te
Wrd Bnk eed fr i inein
n iniin wi 44 eber nrie nd
f n wr renrin deeen
erie rnizin wi re n ,
eyee nd n dinirie bde f $6
biin L yer, i n ien ed
$469 biin Oer e yer, i re f
ifed fr rw r rde nd ineenin rneri wi idde-ine nrie
n rnizin e n eiin ery nd
rin deeen in r nrie
In e in, e Unied Se nd Ere e
d red fr nd ien e wrk
f e Wrd Bnk Gr Hweer, iriy
ere e been e differene in r A
i inein, e Unied Se w e Bnk
renibe fr bidin rn idde- nd
er eni reriy in idde-ine
nrie, in r ride rke fr US
exr A e Bnk ed fr renrin
f n deeen, e Unied Se
yiy fred iin nine
e rn ei n e ri f eni
rw nd rdie ineen en
eiy n e rie er Ere w iniiy
n e reeiin end f e Bnk renrin
effr, ni f wrk w ken er
by e Mr Pn One fy reered,
Ere ben fr e Bnk wrk
exiey wi e re nrie nd e
re ke f e idde-ine nrie,nd e Eren rein rn rnen
f i riry f n ery eiin
Governance
Te ernne rre f e Wrd Bnk rey
irrr e rre f e IMF, wi Brd f
Gernr ee wie yer nd e re
neen f e Bnk dne by i Exeie
Brd, wi re ed f 4 direr
w re ined r eeed by e e eber
nrie r r f nrie e IMF n
wi e reiden f e Bnk, w ere i
irn Te in wei f e nry
i de f b bi e (we e
erded er ie) nd e re deenden n nry redin in e Bnk Unike e
IMF, wi i q reiew eery fie
yer, redin djen re de r
eridind enery ery iiree
Wi 64 eren, e Unied Se by fr
e re in wei e Exeie Brd
f e Inernin Bnk fr Renrin nd
Deeen, fwed by Jn (787 eren),
Gerny (449 eren), Frne (43 eren),
nd e Unied Kind (43 eren) Tee
fie nrie e e ri in eir wn
rereenie fr Exeie Brd Treeer nrie ee ine rereenie
e f e Exeie Brd (Cin, Ri nd
Sdi Arbi), wie e reinin 6 direr
re eeed rereen r f nrie A
wi e IMF, f e er eber f e
Eren Unin riie r f r f
nrie rereened by ne f een er eeed
rereenie n e Exeie Brd
Deiin e Bnk re de by ie jriy
e fr rdinry deiin nd by erjriy
(85 eren) fr ne ye f deiinenden e Arie f Areeen A e IMF, bee
Teniy e Wrd Bnk Gr fr brd (IBRD,IDA, IFC, nd MIGA) f exeie direr wi iydifferen in erene fr e, b ri er,e e indiid yiy ere e exeie direr n fr
From Reconstruction to Development:
The World Bank6
Europe has
long favored
a World Bank
focused almost
exclusively on
poverty alleviation,
while the U.S.
wants additional
emphasis placed
on private sector
engagement and
development.
-
8/9/2019 Saving Multilateralism
23/43
Savg Multlatalsm
Rovatg th hous o gloal coomc govac o th 21st ctu21
Table 4. The World Bank Group today
World Bank Group Est. Areas of specialization Cumulative Lending/
commitments
(billions)
Fiscal 2009 Lending/
commitments
(billions)
International Bank
for Reconstruction
and Development
1944 Focuses on lending to public
sector entities in poor to
middle income countries.
$479
(effective FY 2005,
includes guarantees)
$32.9 for 126 new
operations in 42
countries
International
Development
Association
1960 IDA lends to worlds poorest
countries. Provides interest-
free loans and grants to
public sector to boost growth
and reduce inequality. Major
source of financing forinfrastructure.
$207
(effective FY 2005,
includes guarantees)
$14 for 176 new
operations in 63
countries
International
Finance
Corporation
1956 Finances private sector
investment, mobilizing capital
in financial markets, and
providing advisory services
to businesses. IFC invests in
enterprises majority-owned
by the private sector. Aims
to address constraints to
private sector investment in
infrastructure, health, and
education.
$34.4 (plus $8 in
syndicated loans)
$10.5 committed
and $4 mobilized for
447 projects in 103
countries
Multilateral
Investment
Guarantee
Agency
1988 Promotes FDI into developing
countries by providing political
risk insurance (guarantees)
to the private sector. Insures
investment against losses
related to expropriation,
currency transfer restrictions,
civil disturbance/war, breach
of contract, non-honoring
of sovereign financial
obligations.
$20.9
(includes amounts
leveraged through
the Cooperative
Underwriting Program)
$1.4 in guarantees
issued for 26 projects
International
Centre forSettlement of
Investment
Disputes
1966 Autonomous international
institution aims to providefacilities for conciliation and
arbitration of international
investment disputes.
292 cases registered 24 cases registered
in 2009
The term World Bank typically refers only to the IBRD and IDA. The World Bank Group also encompasses the IFC, MIGA, and ICSID.
Source: World Bank Annual Report 2009.
-
8/9/2019 Saving Multilateralism
24/43
Th Gma Mashall Fu o th Ut Stats22
e Unied Se nr re n 5 erenf e e, i ne n effeie e wer
bk ny ne e Arie, nd
yy bned rnd e ereied
re f i e wer
Mny r fr ernne refr e Wrd
Bnk e been de er e yer, ririy
ied ddrein e ri ibne
re fr e ined e ed by e bi
ree Eren nrie, r fr e US e
wer M reeny, in Ober 8, Wrd Bnk
Preiden Rber Zeik ebied i-eeiin, eded by frer Mexin Preiden
Erne Zedi, f n e dernizin f
Wrd Bnk Gr ernne e Wrd Bnk
Gr n ere re dyniy, effeiey,
effiieny, nd eiiey in rnfred b
ii eny
A e e, e Ciin n Mdernizin
f Wrd Bnk Gr Gernne ned
inifin weknee in ree key re f e
Bnk deiin kin nd ernne ree:
rey frin, ie nd riiin, nd
nbiiy
On strategy formulation, e Ciin fnd
e Bnk k n effeie en fre
er rey n be ed e ririie,
bne rdeff, nd in erin nd
rere wi rei In r, i i de
e diry nre f e Deeen Ciee
nd e inffiien ie ibe nd eniriy
ne eber f e Bnk rren
Exeie Brd
On voice and participation, e Ciin ned e deiin-kin re i widey een
exie nd nber f nenin
nd rie ree e erein e Bnk
i nbe nd renie be ny
ndf f reder Cnribin i
erein i e inifin beween e inre f deein er deeed nrie,
n in f in wer nd ei jriy
re ie rie e US e nd e
niderbe errereenin f Eren
nrie n e Bnk Exeie Brd
On accountability, e Ciin ied in
rir e bi reini beween e
Brd nd neen, e nfi f inere
fr e reiden f e Bnk erin
e irn f e Exeie Brd, e
diffiy in din e reiden nbefr erfrne, nd e nn-rnren
re fr e eein f e reiden, wi i
nwrien nenin e reiden f e
Bnk be US iizen (j e nin
direr f e IMF be Eren)
Te Zedi Ciin ied i rer
in Ober 9, wi inded fie
reendin e Ciin ned need
be ded nd ieened ine ke
Enhancing voice and participation by
nidin e brd ir fr erren 4, in e brd enirey f
eeed ir rereen i-nry
nienie, nd eiinin e ink
beween e IMF q nd e Wrd Bnk
in wer;
Restructuring the World Banks governing bodies
by eein e Brd inieri ee wi
renibiiy fr er rey nd direin
jr iy deiin, eri nd eein
f e Preiden, deein neen e
r f finnin erin nd reinn diry ni f rereenie;
Reforming the leadership selection process by
rein re-bed, inie, eiie
re fr eein e Preiden de
In October 2008,
World Bank
President Zoellick
established a high-
level commission
to focus on the
modernization of
World Bank Group
governance so
the World Bank
Group can operate
more dynamically,
effectively,
efficiently, and
legitimately in
a transformed
global political
economy.
-
8/9/2019 Saving Multilateralism
25/43
Savg Multlatalsm
Rovatg th hous o gloal coomc govac o th 21st ctu23
wy wi e rren n-wrien re reere e Bnk reideny US iizen;
Strengthening management accountability by
rein erfrne reiew re fr
e Bnk reiden, inrein e f exern
ein nd inrein reiew f e
ridin fey ne fr e re; nd
Strengthen the Banks resource base r
inree i i be
Mandate
Wi ree e nde f e Wrd Bnk,
inifin ne redy rred Hweer,
e ny fr refr indie, rein
be dne Wi fr brne in ddiin e
riin Inernin Bnk fr Renrin nd
Deeen nd e ebien f rein
deeen bnk, e Wrd Bnk ed fr
beynd i inii re f endin bi-er
eniie fr renrin M f e Wrd
Bnk rren r i rided r eqiy
ineen, finni erie, nd ii rik
inrne, in ddiin rdiin endin ndrje finnin
In dy wrd, i i er re need
be dne brden nd deeen e re f e
Bnk, riry in i reini wi nn-
e r, be ey rie bine, NGO, r
bier id dnr, enr nen f i
deeen rey nd enre i i n
ryin be in ee Gb eder
nd r ike e ned e
eni reery i ne wi be ririy
ed by e rie er, be i nd rebinee, enrerener, irfinne endin
r, r rik-ker nd finnier fr rnd
e wrd
Prie er rw been e enine wed ndred f iin f ee if
eee f ery in Cin nd Indi in
reen dede Fr Dbi My nin,
in Dead Aid, deeen ine
ernen i ey ney frer r
ernne nd dd e ery f Afri rer
n ein i, R Genn Hbbrd nd Wii
Dn , in The Aid Trap, fr new Mr
Pn f endin direy rie enerrie in
e wrd re nin, e inin f
b rneri fr deeen wi e rie
er r f e Mienni DeeenG, ere re rwin fr re rere
be direy rned rie nd bine
in rder b ie idde nd
e rke inenie nd diiine n re
eni iiy In ddiin, e Bnk need
dj i r ddre e niderbe
eiin i nw fe in e deeen
f infrrre fr nrie, riry
Cin, w re wiin ine direy in re-
e rje wi ny f e iy rin
(ndiiniy) nry ed by e Bnk
e iiie I need enre e Bnk i yin bi re ibe in e
effr enre deeen nd inbe
eni iiy nd in nd Mreer,
e G nferred n e Bnk edin re
in rendin rbe reqirin by
rdined in, ie ne nd
fd eriy3
3 Pibr Si, Leder Seen, Seeber 4-5,9, rr
-
8/9/2019 Saving Multilateralism
26/43
Th Gma Mashall Fu o th Ut Stats24
Mission
A wi e IMF nd e Wrd Bnk, e rini
ernin iniin f e b rdin
yefir e Gener Areeen n Triff
nd Trde, en i er, e Wrd Trde
Ornizin nderne jr ne ine
i w fir neied in e 94 Fwin e
fire f e Unied Se rify e Hn
Crer wd e reed e Inernin
Trde Ornizin, er r f 3 nrie
jined eer in er rrneen ride
reir riff redin nd ree erinde ernin eir rdin reini Te
GATT rided e fr in wi ei rnd
f ier rde neiin were eed,
bniy werin riff n indri d
n indri nrie ( n ye
in rir rd r e br-inenie
nfred d f exr inere ny
deein nrie) Tr i ye f riff
bindin, rnreny, nd derene re
eeiy e rinie f nndiriinin
exreed in e most favored nation (MFN) nd
national treatmentriine GATT rided n nderinnin f iniin biiy
nd redibiiy in inernin rde ered
rnr in e re f 93-ye
reini r e end f f e
enry
Wi e inrein exiy f b ere
e e reniin n GATT eber f e
need fr n rnizin d ride re
reenie rein f inernin rde
Te ITO i w riiny eniined wd e
ed wide rei beynd rde in d, wi ebiiy neie re ernin br ndrd,
diy reeen, reriie bine
rie, inernin ineen, nd rde
in erie Wi e nin f e Ury
Rnd neiin, e GATT eberi
reed e n, in 995, f f-feded
Negotiating the Rules: The World Trade
Organization7
inernin rnizin, e Wrd TrdeOrnizin, wi nw eberi f 53
nrie A wi e riin ITO, e WTO i
nerned wi diiine n rde beynd j
d, nd er rde in rire nd erie
we re n inee rery, bidie,
ineen, nd rde fiiin Te WTO
b bindin die eeen eni
Governance
Unike e Bnk nd e Fnd, e WTO de
n e fr ernne rre wi
ernin r exeie brd Ined, e WTO i
eber-drien iniin, rn by i eber
wi reiey ereri ery
iied wer re, e ie,
in rbe I i rnized r
erie f niririy e Gener Cni,
e Die Seeen Bdy, nd e Trde Piy
Reiew Bdy, n wi e Cni fr Trde in
Gd, e Cni fr Trde in Serie, nd e
Cni fr Trde-Reed Ae f Inee
Prery Riwi re ired by Gene
rereenie f WTO eber nry wi
n nn rin f e ir In ddiin, ere
re ner iee nd wrkin rie
n rir ie re en eber
Wie e reeen ebiin e WTO e
fr nber f redre by wi e d
be ken n erin ie, in rie e WTO
nined ere n nen bi
Crie fr refr f e WTO ben in erne
fwin e e re nd fire
re reeen e WTO inf 999
Minieri Cnferene in See, Winn
Fr yer er, ry befre ner e-n-
ef Minieri Cnferene in Cnn,
e en-Direr Gener f e WTO, Si
Pnikdi, ebied nie brd
ddre e fre f e WTO nd e iniin
ene i fed T r, ed by frer WTO
-
8/9/2019 Saving Multilateralism
27/43
Savg Multlatalsm
Rovatg th hous o gloal coomc govac o th 21st ctu25
Direr Gener Peer Sernd, ied i rerin Deeber 5, n e en nnierry f e
rein f WTO
An er in, e Sernd Rer
fed n e nen-bed deiin-kin
re I reended re n be ed
n ny eber bkin ere erwie
enjy rn nen, nd e WTO re-
exine e rinie f rier re
neiin nd e ibiiy f rin
deiin by rii f eber A
reended were rer nn inierieein, WTO Si f wrd eder eery
fie yer, nd e ebien f nie
bdy fr enir ffii wd ee n
qrery bi I red e deeen f e f
bjeie fr e WTO rein wi ii iey
nd e bi re Te rer exreed
dee nern b e red f rein
preferential trade agreements nd ed fr
reeen be bje eninf reiew nd
effeie diiine e WTO
Tw yer er, Wrwik Unieriy in e Unied
Kind ebied i fir Wrwik Ciin
wi brd nde exine e ernne
f e ier rdin ye in i f
rwin ene Te Ciin ked
wy ner rwin iin frer
rde iberizin in indriized nrie nd
enre e end f e d dinin f
e rde reie by e Unied Se nd Ere
de n ie wy n-er ee r
dieneen I wy fre brd-
bed reeen b e WTO bjeie nd
fnin nd enre e WTO nyreeen re in benefi fr i weke
eber Finy, wi e Sernd Rer,
i ked wy enre e riferin
f rein refereni rde reeen
de n nderine e WTO rinie
f nndiriinin nd rnreny in
inernin ere An er in, eWrwik Ciin reended critical mass
r deiin-kin nd red e
indriized nrie refrin fr neiin
refereni reeen wi e er we
e deeen f WTO diiine nd reiew
eni fr reeen A i reen
Minieri Cnferene in Deeber 9, in e
fe f e nined inbiiy nde e D
Deeen Rnd f rde k, re n
nrie endred r ebi re
reiew e WTO fninin, effiieny, nd
rnreny, nd nider ibe ireenin i f e rid ne in e b eni
enirnen nd e need fr e WTO be
ie nd renie T de, nne f ee
fr refr e reed in ny ne in e
WTO ernne rre
Mandate
Te WTO i i wrein wi e new nde
i w ien in e rniin fr e GATT
n iniin wi e w er
f e riin ITO Aredy r f
ieindin f e Eren Unini
in fr i-frer brdenin f e WTO
nde, wi e ribin e fire
nde e D Rnd in r n i nrrw
end f yeerdy ieney, rke
e in rire, in d, nd in erie4
Oer WTO eber ike Brzi nd S Afri
re re rein, refin e n new
ie ni deeed nry eber ke
d n rie w de e end f
4 See fr exe, Adiy M nd Arind Sbrnin,Fr D e Nex Bren Wd, A New MierTrde Aend, Foreign Affairs, Jn/Feb 9, nendin new rnd f k i needed dee re biiend n D, inin brder e f iniin nj e WTO nd fin n wider rry f ie, indinfd eriy (exr bn n rire, bife iie, e),re, enery rde, exne re, rein f ereinwe fnd, nd ie ne
Already a chorus
of voices
including that
of the European
Unionis calling
for a still-further
broadening of th
WTOs mandate,
with some
attributing the
failure to conclud
the Doha Round
in part on its
narrow agenda
of yesterdays
issuesnamely
market access
in agriculture,
in goods, and in
services.
-
8/9/2019 Saving Multilateralism
28/43
Th Gma Mashall Fu o th Ut Stats26
e Ury Rnd, fer f-enryf reine, iberizin wd be exended
rde in fr rd nd in i nfre
f exr inere deein nrie Ti
n-rnnin ndff i e er f e reen
dedk in e D Rnd
Hweer ee ie find rein, i i er
if e WTO i rein reen i wi need be
ened in e rde ie, brdy defined, f e
weny-fir enry Tee inde eiiniy, ineen iy, enery iy, fd
eriy, b e erie, eny,
enirnen d nd erie, nd
f ddiin ie re b neni
nd e re f bine nernindin
rrin, rre i renibiiy,
exne re, iirin, nd yber eriy
-
8/9/2019 Saving Multilateralism
29/43
Savg Multlatalsm
Rovatg th hous o gloal coomc govac o th 21st ctu27
A nber f bi niie nd eend fr ee ri fr refr f e
Bren Wd riere:
A renize e iniin f b
eni ernne were reed
ery differen ie nd nder ery differen
irne b e fied ne,
riry wi ree e nin
diribin f eni wei nd wer
n nin;
A renize e ierie fr ne
e fr ii eder w re
be ny rir iniin in reniin
f e f i i iry iibe
ne ernne rre fr wiin,
riry wen ne ine ifin
wer wy fr e er;
A fr inreed nd ie ineen
ier ii ee in e ernne f
e iniin, riry in ein rei
direin; nd
A r brdenin r deeenin f erne f iiie nd nde f e exiin
iniin
I rein be een weer e eer ierie
fr rdined b rene e finni
rii nd e eerene f brder nd rner
nen n e G eder wi ride
e needed y fr ne, r weer ee
berin fr refr wi jin n ine f we-
- r ied wi ryin dereef fnfre ny ink wi re in e en f
we-enin b fied ide, we wy by ny
f e e fre ke i rder re
inernin nen n nyin Hweer i
y be, in e enie i i re f e
e ne i needed i n iibe
iee Fr e ier eni iniin
d n need be eey renred
fr e rnd T wd be nreii
Te rren rii i nikey be eier dee
en r f ffiien drin ree 944
en niin-kin enwen jr new iniin nd iniin
reini n be bi new r reed f
we Ined, w i needed i re
kin renovation nd n rebidin
Ti renin f e e f b eni
ernne wd ine rebnin f wer
wiin e exiin iniin wy fr Ere
nd e Unied Se nd wrd e re f
e wrd I wd ine brdenin f e
nde f ee iniin enbe e
ddre e new ie f e dy I wden deeenin f e rdinin n e
iniin, indin e WTO, enre
rein ie d n f beween e rk
Finy, i wd en new ien n
e r f e jr yer wrk brin
e riferin f rein reeen n e
ideine in eir fd
Hw n i be dne?
Renovating the House of Global
Economic Governance for the
21st Century8
This renovation
of the house of
global economic
governance
would involve:
a rebalancing
of power, a
broadening of
mandates, a
deepening of
coordination, and
a commitment
to bring regional
agreements into
the fold.
-
8/9/2019 Saving Multilateralism
30/43
Th Gma Mashall Fu o th Ut Stats28
Te ie wy iee ee i rnfr e G in Cni f Gernr
fr e ree ebied inernin eni
iniin e new Finni Sbiiy Brd
Wie e G y n be erfend debe
wi dbe nine weer e rren
nfirin i e i nee f i
i defied i dber in rein nen
n eifi re nber f rii nd
nreri ie B e Unied Se nd
Ere eered fr e ree i wi
d de f nfidene in e rin Wen
we re kin b refr f e inerninyee G w een e ri bdy fr
ee deiin be de , ned Brii Prie
Minier Grdn Brwn US Preiden Brk
Ob ned e G wi ke e ed in
bidin new r erin Ti
r we fr e G bein Ni
Srkzy ed e Wrd Eni Fr i
Jnry, e rbiner f b ernne in e
enry Te G Cni f Gernr wd
ebi rei nd en ie e ri
iniin e jb f rryin e
Ti G Cni f Gernr wd f n
ree in k:
Sein e rei direin f e
inernin iniin (IMF, Wrd Bnk,
WTO, nd FSB) enre eir nde re
brd en er e ny ie
re nw fin beween e rk ye ired
en enre ineffiien er r
iin ree re ided;
Pin r e neery ne
in e in nd wer rre
e IMF nd Wrd Bnk enre
e iniin ernne rre
refe ne in eni wei, wie
The Harbinger of Global Governance:
Political Leadership and the G209
e e ie infin e WTO widirein nd r fr er
r f ier ee ffii; nd
Hdin e inernin iniin
nbe fr ieenin e direie
e fr e G i nd iin
e inernin iniin fr
d e G eder nbe fr eir
ien e iniin
Pridin e G wi re wd w e
r e rei direin nd en e e
niderbe exerie nd qified ernne
e f e iniin rry i inrin
By iin e G e ninin re f in
eer e ne r wie yer erfr e
fidiry dy f direin-ein nd eri
fr ee iniin, e G wd be red f
nien nd n-in re in ein e re
f b eni iiy Ue f e G fr i
re wd ie e eerin rke nrie
ernen nd inifin ie in b
eni ernne, ein e re ened
in ddrein rbe e ier ee nd
win e y n irn brkerin re
wen differene beween e Unied Se nd
Ere reen e b ridk
A G Cni f Gernr d enre
ny nry in rdbk e
ieenin f reed-n ne n
be ined nd rered in e r f
inernin inin eri neery ne
e ed Ti inreed nbiiy wd
e in b direin, wi e iniin
eee in e i-ee ii
bdy wi ke nern b fire
fw r wi rir ien Pyin
i rei ederi re wd w e
G fi n f-ied need fr i-ee ii
Use of the G20
as a Council of
Governors would
give the emerging
market countries
a permanent and
significant voice in
global economic
governance,
getting them
more engaged
in addressing
problems at the
multilateral level
and allowing
them to play
an important
brokering role
when differences
between the
United States
and Europe
threaten to cause
global gridlock.
-
8/9/2019 Saving Multilateralism
31/43
Savg Multlatalsm
Rovatg th hous o gloal coomc govac o th 21st ctu29
eneen in e inernin iniin, bei n een ier ee n iniiy enied by
e refrer Finy, inin f e Wrd Trde
Ornizin wiin e bi f renibiiy
f i Cni f Gernr wd enre
e WTO ke i rif e n e
inernin iniin, in reniin f e
rii ink beween finne, deeen, nd
rde, nd e ierie f in e exerie ndre f e WTO enre rie enerrie
n be fy ened in wrdwide eni
reery nd fre reriy In ddiin i
new re fr e G, i wi be neery
reffir r fr e ier iniin
e ie ii ee, nd ddre e
exin f rein reeen
-
8/9/2019 Saving Multilateralism
32/43
Th Gma Mashall Fu o th Ut Stats30
On e ne nd, e inernin rnizine been ken ew fr rned
widey-eed ne n e b
ene On e er nd, ey e bee e
re f iren re nd inin ii
rebke fr ny qrer Te n e ri,
riry in e Unied Se, deey reen e
Unied Nin nd ee i inier inren
f frein dinin On e er ide f e
idei er, e n e ef freqeny
e e rd nd ine e re re fr
eein f e WTO r IMF nd Wrd
Bnk, bjein w ey ee e re fee iniin in exerbin e wr f
bizinrwin ineqiy fnne
we e inin rrin wie
ein e re nrie eer frer beind
Priry i ie f rii, i i eeni
e w ndernd nd reie e rii
wrk f ee iniin nd fr e nd
fr e brd ieri ey rereen
Fire d wi ny nderine r in e
iniin nd in e beief b eni
rbe n nd d be ddreed by Ifnin ee, e inernin iniin brin
b enie f e nd dee exerie
nn be rediy reed A e wrd nd i
rbe rw re ex, i knwede
ed in ny nrie nd er n
erid f ien ny be d e if e
iniin eee re rery inined
Te iniin e reer yin wer nd
ner-er, brder-bed r rein
b eni rbe n ny bier
r rein rrneen de Tey e been
brinin eer ee nd ide fr rnd ewrd fr re n 6 yer in ne fr,
eein, rje nnin ein, nd re
Awy fr e er nd e idei
kereen, i i in e ndne dy--dy
eein, rer, nd rje bein nded
Reaffirming Multilateralism in a
World of Regionalism10
wiin ee iniin ieri i fen dned Cnrie e in e bi
f wrkin eer nd e irn
nderndin b b e bne nd e
redre fr eir eie in A edy
re f infrin i exned, nderndin
reed, nd nr ebied r ee
iniin erin Fr exe, deie
e inbiiy f e WTO re nen n
ein f e D Rnd, reeen
nd n nderndin been ieed
r e nin wrk f e ri WTO
iee, riry e Cni fr Trdein Serie nd e Ciee n Sniry nd
Pyniry Mere5 Wie ee rie
dn rie e ee f fr rekin, ey d
fr f e bred-nd-ber f ier
iiy i rii if nrie re in
e eer in ie f rii
Te een f G eder nd er
rin ee ier iniin nd
eir wrk in rirnd e rinie f
ier erin in enerre be
ended, nd wi need be reeed er nder e iniin nine re wi e
fen-neni ie f e enry A e
e ie, nber f re ieri
be knweded nd ddreed M
irny n ee i e rid rw
f reini nd rein ine nd rde
rrneen
5 Fr exe, e WTO Ciee n Sniry ndPyniry Mere ded deiin n eieenin f Arie 4 f e SPS Areeen rerdinreniin f eqiene f differen ndrd, redre
enne rnreny, nd ideine frer eieenin f e SPS riin n rein nd e-freere See Andrew Ln nd Jnne S, Te Hidden Wrdf WTO Gernne, The European Journal of InternationalLaw, V , Ie 3, 9, 575-64, iin WTO D S/C/M8 nd WTO D S/CSC/M/7
The multilateral
institutions have
economies of
scale, depth of
expertise, greater
staying power
and a longer-
term, broader-
based approach
to resolving
global economic
problems than
any bilateral
or regional
agreement does.
-
8/9/2019 Saving Multilateralism
33/43
Savg Multlatalsm
Rovatg th hous o gloal coomc govac o th 21st ctu31
Te debe er weer rein reeennd rein rde reeen in rir
nribe r der fr e ier
ye rwn in ineniy e nber
f new reeen, reeny in Ai,
kyrkeed Indeed, in e fir 45 yer f e
GATTe erid beween 948 nd e rein
f e WTO e nin f e Ury
Rnd4 rein rde reeen were
nified, e n ree yer By nr, e
5 yer w 333 new nifiin f
reeen, re n yer A f Ober
5, 9, 457 rein rde reeen d beennified e WTO, 66 f wi re rreny
in fre6 Te reen i e Aiin f
S E Ain Nin (ASEAN)-Cin Free
Trde Are (ACFTA), ned n Jnry ,
Ti i e re free-rde re in e wrd by
in (9 biin), wi bined GDP
f $6 riin, kin i e ird re (beind
e Eren Unin nd NAFTA) by eni
e Te ASEAN-Ari-New Zend Free
Trde Areeen (AANZFTA) wen in effe
n Jnry , erin 6 iin ee nd
bined GDP f $8 riin
Nr i rde e ny re in wi ei
bw f rein ine re in in fre
Te Cin Mi Iniiie Mierizin
(CMIM), rein finni eni in
Ai, enin e ASEAN, Jn, Kre,
nd Cin, e $ biin fiiy deined
renen e rein iy ferd
in inreed rik nd ene in e
b eny Te re bjeie f i Ain
Mnery Fnd re (i) ddre bne-f-
yen nd r-er iqidiy diffiiein e rein, nd (ii) een e exiin
inernin finni rrneen A , i
rereen rein eiin e IMF, bei
6 Wrd Trde Ornizin, Rer f e Ciee nRein Trde Areeen, WT/Re/, 6 O 9
wi w en i be fr nw e IMF wi ikey rein e ender f rer
een wiin e CMIM rein
In e deeen ren, e Wrd Bnk
een n exin in e e f r fnd, wi
re bier r rein deeen fnd
qerdin ier ne Te Wrd
Bnk y dinier e, b e fnd
be en were nd w e fen e dnr
deine Oer nd r fnd
e been ebied in reen yer L yer,
dibreen fr r fnd eqed ff e Wrd Bnk dibreen Teer
wi bier deeen ine, r
fnd w dnr ie eir wn
nd rey, wi n brin in bier ii
rere r r-er r nrrw f y
n be in e be inere f nry we
Cin, fr exe, biin f dr in
infrrre rje in Afri wie nribin
ny $3 iin e Inernin Deeen
Aiin (IDA), e Wrd Bnk r deined
e e re nrie
A in , i rn rein r bier
rrneen in ie f ier ne i
e, wi rxiey 5 eren f rde
rrin nder reeen nd b 65
eren f id rreny in fr r
fnd, bier id fnd, r eri n r
rn fed n rir ie Wy
dri if? Mny nrie rnd e wrd
e rned wy fr ieri nd e
ier iniin fr nber f ren
Fir, ere re nn-iniin ernie e
ier yernin fr brd rryf rie ineen n e IMF
e infrrre rje re finned
by frein ernen r er id fnd, fen
nderinin e re f e Wrd Bnk Send,
ny deein nrie re kei b
iniin e by e rnni wer in
This turn
to regional
or bilateral
arrangements in
lieu of multilatera
ones is huge, wit
approximately
50 percent of all
trade occurring
under such
agreements and
about 65 percen
of all aid current
coming from trus
funds, bilateral a
funds, or vertica
loans or grants
focused on a
particular issue.
-
8/9/2019 Saving Multilateralism
34/43
Th Gma Mashall Fu o th Ut Stats32
wi ey dn e inifin ie r nyre nfidene e iniin wi ddre
eir need Tird, ey e fnd rein
reeen eier re, eier bee ey
dn reqire in e f e rde rbe
n e be in ier neiinfr
exe, rir bidy ie e WTO
r iy bee rein n reeen n
bier r rein bi i eier n ryin
re n reeen n e ide f rie
ny reeen e ier ee
Te dwnide f i r reini reny Te ie, enery, nd rere reqired
neie bier r rein reeen re
niderbe, nd by neeiy ke wy be
ie, rere, nd ii i ibe
nrie dee ier reeen A
e e ie, bier r rein reeen
re re bje e rie f dei
iiindeed, ey re fen iniied in
rene ririi eri r frein
iy rere Ten, ne ey re in fre,
f ee reeen e wek r nn-
exien die eeen eni, kinien nder reeen rder
enfre Bier nd rein reeen
fen e niqe re nd riin, wi
inree er rnin in e ye
nd ke i diffi fr deein nrie
ndernd w ey need d y
wi wide rry f differin e f re On
e rde ide, reeen fen exde
rir rd r dn w fr inf in r rere fr nrie ide
f e rir reeen, wi n ed
ineffiienie nd b-nd-ke ye f
rde in wi wer-bed rrneen bein
erde e rein f re-bed nn-
diriinry ier rdin ye7
Finynd irnyriferin
refereni reeen by eir ery exiene
end rn in f rwin k f fi in
ier iniin nd e ier ye
A , i i ierie e ierye wrk fix rbe deerren
deeer eneen by deein nrie
wie e e ie wrkin brin e
ri bier nd rein rrneen wiin
eir ye Te ier iniin need
renize e rein reeen re
ie in nide nd e nd e dded
enr exiy e ye, b
e e ie ey re ere y M reny
needed fr e ier iniin re er
ideine fr ny reeen enre
ey re ein ne ieri rern brrier enry fr nyne ide ny ien
rein r bier rrneen
7 Te eni fr rein rde reeen nderinee ier ye e been widey died See frexe Jdi Bwi, Termites in the Trading System: HowPreferential Agreements Undermine Free Trade, Cni nFrein Rein (8)
The multilateral
institutions need
to recognize
that the regional
agreements
are massive in
magnitude and
add enormous
complexity to the
system, but they
are here to stay
and need to be
accommodated
and incorporated
into the
multilateral
system.
-
8/9/2019 Saving Multilateralism
35/43
Savg Multlatalsm
Rovatg th hous o gloal coomc govac o th 21st ctu33
Drin e rii erid f e Bren Wdnferene f 944 nd in e n
fwed, re r f e wrd iked ief
fr e rin f derein nd wr nd ried
rnd e iinrey e fr by e Unied
Se nd Gre Briin ree iniin
nd rd wd reen reeiin f
e dier f e 93 by win fr b
eni erin nd ier ernne
Ten-US Preiden Frnkin Den Ree,
in i ddre e US Cnre, dered
e wrd wi eier e wrd niy nd
widey red reriy, r i wi e r,nin e en-eerin n fr e Bren
Wd iniin nd e b rdin ye
rereened e ne y e eni bi
fr e ere nd eef wrd we deire
Te reen b eni rii n been f
e e rder f nide f e een f e
93 B i de rereen ner rnfrie
en in wrd iry In rir, i reen
e Unied Se nd Ere wi ner
rniy exerie red rnni
ederi enre e iin f eir eder n be reered, ded, nd rried
frwrd in e enry wi e ene
i brin W d Ere nd e Unied Se
need d ee i ene?
Fir, ey need i n ie n e
ier eni iniin, b refr
e ined Teer, e Unied Se nd
Ere reed ee ier iniin nd
ey e in eer in keein e
e re f e b eni riere
Hweer, enrin ee iniin reinreen, eiie, nd effeie wi en e
inifin ne in e nner in wi b
e Unied Se nd Ere riie in eir
erin Tee ne re n rniy
w re ederi n e wrd e e
f e nein in e fr wer rre
Areein ke ee nein wd end werf in e re f e wrd
ey n e fi ee iniin re
nin de ifin reini
in e b eny nd n eqy werf
ffirin by e rnni wer f eir
ninin reine n ier iniin
Fr i r, e Unied Se d ie n
b e nwrien re e ed f e Wrd
Bnk be n Aerin nd e iniene
i rein e wer er er reqirin
erjriy In ddiin, e Unied Sed r e e f e G rei
eerin r r Cni f Gernr fr e
Wrd Bnk, IMF, nd WTO enre rn
G re in rey frin nd rdinin
wd ie reer ie e eerin
rke enie
In e e ein, e eber e f e
Eren Unin d ie n e nwrien
re e ed f e IMF be Eren,
nd wrk nide Eren e nd e
e IMF nd Wrd Bnk eier in ine
Eren e (wi wd ie Ere e
ine re in re) r e nide
i een ri e wi e bier Eren
enie Ere end wi n
re n fr e A wi e Unied Se,
e Eren Unin nd i eber e
d end eir r e G e
eerin iee f e b eny
Fr Ere, e fr f Eren riiin
in e Bren Wd iniin reen
ene nd n rniy ree e be
wy enre e rne eie Eren
ie in b eni ernne Te in
in fre f e Libn Trey ie e Eren
Unin fr inernin e erniy,
nd rnd e wrd e EU i rernizin i
rereenin, re wi nine wi e
Transatlantic Multilateralism
for the 21st Century11
In order to save
the institutions
they started, the
U.S. and Europe
need to give up
some of their
formal power in
order to allow
more legitimate
and more relevan
institutions to
emerge.
-
8/9/2019 Saving Multilateralism
36/43
Th Gma Mashall Fu o th Ut Stats34
frin f e Exern Ain Serie A refrf e ernne rre f e inernin
eni iniin wd ie Ere ner
rniy i new in erin
Tdy, e WTO, Ere ek wi ne ie,
r e rereenin by e Eren
Ciin Te ie i e e e Bren
Wd iniin, were e Eren Unin
n fr e nd n ny r
e ie f erin eber e Nr de
e Erzne e fr e e IMF A
e G, e Eren Unin nd e ErenCiin e been reenb , , e
been indiid eber e (Frne, Gerny,
Iy, nd e Unied Kind, er jined by
Sin nd e Neernd), wi e f ee
eber e erdwin e Eren Unin
Refrin e nner f Eren riiin
in e Bren Wd iniin d be win-
win fr Ere I wd w Ere w
ederi nd ien e dernizin
f e ier iniin wie e e
ie nidin Eren wer in ine
b rer in re B i wi n be ey Teree eber e wi ernen eFrne,
Gerny, nd e Unied Kindwi n db
rei iin eir exie ri Mny f e
ie reed finni rein nd refr re
i rried e nin ee, een wiin
Ere nd wiin e Erzne Hweer, e
rniy bin re infene by in
eiey in i ne ren f inernin
eni iniin ernne be
ein fr Ere Tee iniin d n
rie e e ii rbe f Eren
nidin wd be reen e UN rin er fr Priiin ne Ere d be
een frerne f e re f rdined
Eren r w ben in rerin
fr e G Leder Si nd f e Libn
Trey f kin e Eren ie in e
wrd rner
Nneee, n er, f i d be een dri f wer n b ide f e Ani
B ri er, diinin in wy er
e iniin f b eni ernne
d re in ner-er in wd e
fr rner, re eiie, nd re effeie
iniin ere e ninin benefi
f e Unied Se nd Ere nd e kind f
be, en, re-bed b eny ey b
r If e re nd rieri fr eein
e ed f e IMF nd Wrd Bnk were ey
eri-bed, nd if e Unied Se nd Eren
Unin nined iy-qified ndide, eywd ikey nine ke eir rn in in
eir nin ere in ederi re Mreer,
wie e ex in re f nrie i n
irn yb f eir wer, few if ny fr
e re ken in rie In e re f findin
ffiien r fr ny ien r r f
fr e, e nidin f Ere in
ine ie y re in re, n e, infene
Mreer, e diinin in e in re
f e Unied Se r Ere wd i ee
b wer wi e biiy bk bjeinbe
ne iy by findin ndf f ernrie jin e
A e WTO, e nern er nd need fr
rnni ederi re ew differen,
wie e ene f effeiene, eiiy,
nd reene re e e Unike e IMF nd e
Wrd Bnk, e WTO de n e n exeie
brd r neen brd, nr de e WTO
Sereri e e wer e ririie r
re new re r fr rre re
new re er n r nennd
rdiiny ny r rnd f neiinTi en e WTO de n need ene
in ny fr rebnineriny n in e
direin f frer dein r rediribin
f wer Hweer, e WTO eberi de
need fr new ine nd r wd
ree e bi fr deiin-kin in e bene
f ee nen I i in in eer
Today, at the WTO,
Europe speaks
with one voice,
through sole
representation
by the European
Commission.
The opposite is
the case at the
Bretton Woods
institutions.
-
8/9/2019 Saving Multilateralism
37/43
Savg Multlatalsm
Rovatg th hous o gloal coomc govac o th 21st ctu35
ee ine e Unied Se nd eEren Unin d y ederi re
by kin eriy e reendin f e
Sernd Rer, e Wrwik Ciin, nd
er nribin in e ernie
e ine nderkinn -fr-ne nd ne-
fr- nen ny re US nd Eren
eder d enre eri debe b
e WTO ernne rre nd i e in e
b eni riere ke e nw, wie
eder fr rnd e wrd re fed n
ree ir f e ye nd d ke i er
i exinin n be nded widerien e nin e nde e
D Rnd neiinnd in f d een
nribe eir ef nin Ti i e
en fr e WTO ke i rif e n
eq rner wi e IMF nd e Wrd Bnk in
e b eni ye
Send, e Unied Se nd Ere d e
e G e effiien eni iner
i-ee ineen in e ernne f ee
iniin, riry eir rei direin
ein nd e erene n e Tey need enre e nde f ee iniin
re dernized er e ny ie re
rreny in nddreedindin fd
eriy, enery iy, ie ne, eiin
iy, nd rrinwie rein in
diin n e Tey ke
eriy e ien w eir wn
reni iie be bje re
riny by e G nd e IMF fr nieny
wi e G Frewrk fr Srn, Sinbe,
nd Bned Grw Mreer, b e Unied
Se nd e EU need ke eriy er fr refr f ee iniin nd
ik wi e refr re ni e neery
renin f e iniin re eed
Tird, e Unied Se nd e Eren
Unin d reffir eir ien
ieri by wrkin ierize e
ne f eir wn rein reeen nd d e f ideine fr ny frer reeen
enre ey d n der fr r
nderine e ier ye8 A in ny
er re, e Eren Unin nd e Unied
Se e been e frefrn f reini Te
Eren Unin ief i rein reeen
e re eni free rde re in e wrd,
fwed by e Nr Aerin Free Trde
Areeen, inkin e Unied Se, Cnd,
nd Mexi Gien eir ederi re in b
ier nd rein rw, e Unied
Se nd Ere d ed e wy infindin wy ierize ee reeen,
riry e reeen ey e e in
n wi er nrie, in nner wi
brin e er ieri Crreny,
e Unied Se nd e EU rein e er
re rdin rnerfr exeedin eir rde
wi ny er nry Fr exe, US w-wy
rde in d wi e EU ed $988 biin in
9, wie i w-wy rde wi Cin w $366
biin Hweer, i n e i f inifin
rdin rner fr b e US nd e EU re
nber f nrie wi w b eneied free rde reeen, nby
Cnd (e Unied Se end re rner
nd Ere fif), S Kre (e ix re
rdin rner fr b e Unied Se nd e
EU) nd Mexi (e fr re rner fr
e Unied Se nd en fr e EU) If ee
n reeen ne d be reed in
ier reeen, e Unied Se nd e
EU wi e dne brin bni
n f rde bk in e ier fd
8 Te ne f ierizin rein reeen been died in dei nd er fr,indin e Seeber - 7, nferene eWTO, Mierizin Reini: Cene fr eGb Trdin Sye See in rir, Rird BdwinMieriin Reini: Sei Bw BidinBk n e P Gb Free Trde, The World Economy29 (6)
-
8/9/2019 Saving Multilateralism
38/43
Th Gma Mashall Fu o th Ut Stats36
Te irn nribin be de i ree n rinie ide effr
wy f diiniin e reeen re
ebe wiin ier ye nd e
re n Aebe reeen wd inde
e :
D n ree nfi wi eber
biin nder ier reeen,
e WTO Areeen r e IMF
Arie f Areeen
Are e rnren ier
reeen
Reqire f dire f e dei
e ier iniin nd bje e
rein reeen eni een
by e reen ier iniin fr
inifin innienie wi ierbiin
Wi ree rde reeen, wrk
redy been dne in ny fr n e
eifi f rnizin re f riin, r
ridin rniie e in in e
nfre f d, rein nfi beween
die eeen riin, y renizin
rery r nd re9 Te Eren
Unin nd e Unied Se need ree
nderke i wrk nw in rder w er
eir wn rein reeen n e ne reer ier inerin
9 See Rird Bdwin nd Prik Lw,MultilateralizingRegionalism Anni Eederd nd Ki SinenBridin Rein Trde Areeen in e Aeri, SeiRer n Inerin nd Trde, Iner-Aerin DeeenBnk
Figure 2. U.S. and EU Free Trade Agreements
U.S. Free Trade Agreements EU Free Trade Agreements
Source: USTR
The United States has signed free trade agreements (FTAs)with
Colombia, Korea, and Panama, but Congress must enact legislation
to approve and implement each agreement in order for them to go
into effect.
Source: EU Trade-European Commission (Jan. 11, 2010)
1Both the United States and the EU are in the process of