New institutions deserve a warmer welcome – experts

New institutions deserve a warmer welcome – experts

Страны БРИКС заслуживают должного уважения, утверждают западные аналитики. Во-первых, они представляют собой «локомотив» экономического роста и способствуют притоку инвестиций в инфраструктурные проекты развивающихся стран. Для сравнения, Всемирный банк за последние десять лет выдавал совершенно мизерные объемы финансирования на инфраструктурные проекты. Во-вторых, новый банк БРИКС составит должную конкуренцию не только ВБ, но и другим многосторонним финансовым структурам.

Sir, In your editorial “Beijing’s challenge to the world of Bretton Woods” (October 31), you warn China that “if it does not embrace transparent and exacting governance standards” for the four international financial organisations created this year “they may wither”. Successive scandals in Wall Street and the City of London (think of the Libor scandal) suggest that these centres continue to flourish with less than transparent and exacting governance standards.

More generally, the new organisations warrant more than your lukewarm welcome. First, they will boost the level of infrastructure investment in developing countries. In contrast, the World Bank lent scandalously little for infrastructure over the past decade; it could have justifiably lent 10-times more. Second, the new organisations will provide needed competition with the Bank and other multilateral development banks.

Third, the new organisations will hopefully scare western states into allowing a real rather than nominal reallocation of voting rights in the Bank and the International Monetary Fund in favour of “developing and transitional countries” (DTCs). The G20 at the Pittsburgh summit in 2009 called for the Bank to make a 3 per cent shift in favour of DTCs and the IMF to make a 5 per cent shift. Today, five years later, the shift in the Bank is minus 0.03 per cent and in the IMF plus 0.11 per cent; in other words, virtually nothing. In the IMF, one dollar of gross domestic product in the EU5 (Germany, France, UK, Italy and Spain) continues to be worth almost three times as many votes as a dollar of GDP in the Brics (Brazil, Russia, India, China, South Africa).

Western states should recognise that fuller participation by governments of “emerging economies” in global or regional governance organisations is the route to inducing them to think of global interests, not just national.

Robert H Wade

London School of Economics
 

Jakob Vestergaard

Danish Institute of International Studies