Global Financial Reform - Where Do Things Stand?
Published: June 2012
This article provides an assessment of the progress that has been made since the outbreak of the global financial crisis in 2008 in official efforts to strengthen the international financial architecture with a view to minimising the risks and severity of future crises. These efforts, which have been spearheaded by the G20, have focused on the following four areas where the current arrangements for global financial governance need to operate more effectively: (1) international policy coordination to improve the international adjustment mechanism; (2) an international lender of last resort mechanism for countries confronting liquidity constraints or adverse spillover effects from global financial shocks; (3) the oversight of global financial stability; and (4) the coordination of international financial regulation. The progress to date in improving these four areas or functions of the international financial architecture has been very uneven. In addition, further reform is needed in strengthening the institutional underpinnings of the international financial architecture itself.