The role of multilateral institutions in a transitioning global order
On the 80th anniversary of the Bretton Woods Conference, the institutions underpinning the international monetary system face complex new challenges. Geopolitical dynamics are changing the landscape of international co-operation on financial stability and economic development, in particular for attempts at global rulemaking and standard setting.
During the 2024 International Monetary Fund-World bank spring meetings, OMFIF, the Visa Economic Empowerment Institute, and Standard Chartered convened experts from the public sector, industry and academia to discuss the implications of these changes for the future of institutions including the IMF and World Bank.
Key participants included José Viñals, Group Chairman, Standard Chartered, Axel Weber, Chair, Advisory Council, Visa Economic Empowerment Institute (VEEI), Koji Tsuruoka, Member, Advisory, Visa Economic Empowerment Institute and Jonathan Hill, Member, Advisory Council Board, Visa Economic Empowerment Institute.
The roundtable participants explored the state of multilateralism and the need for reform, citing the IMF quotas as an important step forward while identifying a crisis of representation. They discussed the rise of minilaterals – new institutions that have smaller and more geopolitically aligned memberships, allowing them to reach political and economic consensus more effectively but without the reach of truly global multilateral institutions.
The importance of multilateral collaboration on sustainability was also raised. Participants looked to the IMF to include climate conditionality within its programmes and to governments to commit more funding, acknowledging that the private sector will only step in when there is a business case. The need for regional taxonomies to be interoperable on climate change was also a priority.
Participants addressed how governments are balancing regional integration with multilateral co-operation with regard to trade. The rise of agreements made with like-minded countries rather than along geographic lines, such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, is a positive development.
Finally, the growing digitalisation of the economy has brought to the fore the need for closer public and private co-operation on drafting digital economy regulation. According to the participants, digitalisation means the private sector will need to have an increasing role in creating new regulation due to the lack of government expertise on the issues.
   
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