COE 51,21 WARRENTON, VIRGINIA 15-16, 2017 OCTOBER EMERGING MARKETS FORUM
2017 GLOBAL MEETING The Emerging Markets Forum was created by the Centennial Group as a not-for-pro t initiative to bring together high-level government and corporate leaders from around the world to engage in dialogue on the key economic, nancial and social issues facing Current and emerging market countries. Future Threats to Multilateralism: The Forum is focused on some 70 market economies in East and South Asia, Eurasia, Latin Causes and America and Africa that share prospects of superior economic performance, already have or Possible seek to create a conducive business environment and are of near-term interest to private Remedies investors, both domestic and international. Our current list of EMCs is shown on the back cover. We expect this list to eveolve over time, as countries’ policies and prospects change. Johannes F. Linn Background Paper
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Executive Summary
Johannes F. Linn, Distinguished Resident Fellow, Emerging Markets Forum
The paper assesses potential threats to the multilat- • The G20, supported by its G20 Eminent Persons eral system and institutions. It focuses on the multilateral Group on Global Financial Governance, must financial institutions, the UN, global trade and the WTO, actively focus on the threats to multilateralism and the Paris climate agreement and the Green Climate Fund, multilateral institutions. and the G20. • During the current phase of (possible) US with- The principal conclusions from the paper’s analysis are: drawal from global development leadership • Multilateralism and multilateral institutions face other countries have to play a constructive role serious threats at a time when the need for effec- in maintaining and further strengthening the tive multilateral discourse and action arguably is multilateral system. more important than ever. • Selected specific priorities for governments around • The threats include factors and trends at the the globe to help preserve effective multilateral geopolitical level (including the changing balance institutions and actions in a rapidly changing between old and rising powers, and the poten- environment include: tial for a “new cold war”), at the national (esp. • Stop the further fragmentation of the multilat- the rise of nationalism, populism, and antidem- eral system and consolidate existing funding ocratic tendencies), and at the institutional level windows, wherever possible. (including fragmentation, problematic governance, • Fix the governance issues of the IMF and and inefficiency). WB and agree on a substantial increase • Some of these threats may be short-term and in the IMF quotas and in the World Bank cyclical in nature. But many of the threats appear Group’s capitalization. to be of a longer-term nature. • Focus reform efforts of the UN system on • The single biggest threat in the immediate future improving the efficiency of the major individual is a possible withdrawal of the US from its tradi- agencies and on enhanced collaboration at the tional leadership role in supporting multilateral country-level. approaches to global challenges. • Systematically focus on how to generate more • This confirms the core thesis of this paper: Since development impact at scale by enhancing the we cannot be sure the threats are short-term operations, partnerships, and financial leverage or cyclical, and since we cannot afford to be of the multilateral development institutions. wrong in assuming they are, it is critical to pre- • Resist tendencies for increased protectionism serve multilateralism and in particular the global and revive the multilateral trade agenda, by lib- multilateral institutions. eralizing agriculture, facilitating trade in services, The paper proposes the following options for action: and tackling regulatory convergence. • Multilateralists and multilateral institutions as a • Ensure that the voluntary pledges under the group need to make a stronger and more effective Paris Climate agreement are fully implemented case at the popular base and to national lead- and, if possible, exceeded. ers in defense of multilateralism and multilateral • Focus the G20 Summit exchanges on a few institutions. high-level strategic issues, including trade, cli- • Multilateral institutions must raise their game. mate change, and strengthening the multilateral institutions and processes.
Acknowledgments: The author gratefully acknowledges the comments and suggestions of Harinder Kohli on an earlier draft, and the research assistance of Michael Whelan and Leo Zucker. The author presented the main ideas in this paper at a seminar hosted by the Ministry of Foreign Affairs of Finland on March 25, 2017 and benefitted from the comments of Ms. Elina Kalkku, Under-Secretary of State, of Ms. Tarja Halonen, former President of Finland, of Professor Finn Tarp, Director of UNU-WIDER, and of other participants. i
Current and Future Threats to Multilateralism: Causes and Possible Remedies A Draft Paper for Discussion at the Global Emerging Markets Forum, October 2017 Johannes F. Linn, Distinguished Resident Fellow, Emerging Markets Forum
Introduction ideas on how they might be addressed. Just to be clear, Multilateralism and the multilateral institutions face seri- though, multilateralism is not just about the financing of ous threats. This in turn threatens the continuing progress investments. It is very importantly also about developing in solving critical global economic and social challenges: and maintaining rules-based and fair global economic slowing global economic growth and recurring global and social relations among countries and peoples, about financial crises; growing inequality and – despite signifi- setting widely accepted norms and monitoring their adher- cant improvements in living conditions worldwide in recent ence, about establishing networks to create, collect, and decades – persistent deprivation due to poverty, hunger, exchange knowledge and data, and about resolving poten- conflict and fragility, esp. in Africa; rising challenges to an tial conflicts among partners and competitors for global open global trading regime; and the pervasive risks of pan- resources, markets, and influence. demics, natural disasters, and climate change.1 There are two countervailing trends over the last seven If this statement sounds excessively gloomy, consider decades:3 After World War II (WWII) globalization and glo- Mohamed El-Arian’s opening paragraph for his op-ed balism took hold, reinforced after the fall of the Bamboo in the Guardian on September 20, 2017: “Next month, and Iron Curtains by the integration of China and the when finance ministers and central bank governors from Former Soviet Block into the world economy. This was more than 180 countries gather in Washington, DC for reflected in rapid global connectivity and economic inte- the annual meetings of the International Monetary Fund gration, the development of a rules-based international and the World Bank, they will confront a global economic order supported by the rise of the global and regional order under increasing strain. Having failed to deliver the multilateral institutions, drastic declines in extreme pov- inclusive economic prosperity of which it is capable, that erty and increases in living standards across the world, order is subject to growing doubts – and mounting chal- and a growing recognition of continuing and new global lenges. Barring a course correction, the risks that today’s challenges, and far-reaching agreement on the emerging order will yield to a world economic non-order will only global development and climate change agendas. The intensify.” On the other side, David Bosco believes in the approval of the Agenda 2030, the Addis Agenda, and the “durability of multilateralism” when he writes in the Journal Paris Agreement of COP21 in 2015 represented a high of International Affairs that “we’ve been here before” and point in this trend towards a global agenda underpinned that “[President] Trump’s challenge to the slow march of by multilateralist approaches. multilateralism may be even less consequential than de However, recent years also have shown increasing Gaulle’s.”2 stresses in the multilateral system, which appear to have This paper aims to assess the threats faced by multi- intensified since about 2014. In the geoeconomic and lateralism and multilateral institutions and to develop some geopolitical arena, the dramatic shift of the economic bal- ance from the G7 countries towards the emerging market
1. For a very recent update on both progress and challenges for the fu- economies has meant that what used to be a bipolar world ture see the Bill & Melinda Gates Foundation report “Goalkeepers: The Stories behind the Data”, released on September 13, 2017. (Bill & Melinda (US-USSR, 1950-1990) and briefly a unipolar world (US, Gates 2017). The Economist magazine carried a cogent summary of this in the 1990s) is now rapidly becoming a multipolar world report on September 16, stressing the fact that while much progress has been made in recent decades, “progress on several fronts may be start- (China, Europe, India, Russia, US, and perhaps others).4 ing to falter.” https://www.economist.com/news/international/21728905-re- port-gates-foundation-spells-out-biggest-risks-future-progress-great 2. https://jia.sipa.columbia.edu/we’ve-been-here-durability-multilateralism. 3. See, for example, James (2017), Council of Foreign Relations (2016), Bosco also penned a piece in the Washington Post on 24 September Kharas (2017a), Ikenberry and Lim (2017). 2017, in which he set out to debunk five myths on multilateralism, including 4. In 1960, G7 countries contributed 57 percent of world GDP (in PPP); “Myth No. 5: Trump is damaging multilateralism.” by 2016 the developing economies contributed 56 percent (Kohli 2017). 1 JOHANNES F. LINN, DISTINGUISHED RESIDENT FELLOW, EMERGING MARKETS FORUM 2 The potentialfortensionsandpossiblyconflictbetween 7. TheBRICS2017Summitdeclaration stated:“Upholdingdevelopment decades. of the US as a leader in global multilateral affairs and also of globalandregional institutions,theynowappeartofavor of DonaldTrump asPresident oftheUSin2016are widely of elitesandexperts,risingnationalism,populism, established powerandarisingpower, eventuallyleading cold war.” of East-West tension, perhaps even a “new” or “second and Russiahaveincreasingly resisted thetraditionalrole and Asia are following similar tracks. Certainly, China, India, and solutionspursuing“ourcountryfirst”objectives.In a more “transactional”approach involvingbilateraldeals approaches. Whereas inthepast,theysupportedarules- and supportofthesetwoAtlanticpowersformultilateral a highlyfragmented,competitive,andpotentiallyunstable authoritarian regimes threatens to reverse earlier trends astute observersasserious. While inmanywaysawelcomedevelopment,andindeed support formultilateralapproaches andsolutions. Inthe sign ofthespectacularsuccessmultilateralismover seen as the key turning pointsinthetraditionalleadership seen asthekeyturning democratic andrepresentative politicalandeconomic order.” international and multilateralism,weare workingtogetherforamore just,equitable,fair, weakening nationalpoliticalconsensus,growing distrust this regard theyare notalone,asothercountriesinEurope towards democracy worldwide,aswellaweakening today’s established and rising powers, and especially to war(asbetweenSpartaandAthensinAncientGreece). for exampleduringthemostrecent BRICSsummit. ration-signed-at-xiamen-china-russia-brazil-south-africa-brazil-4828219/ profess adherence toopentradeandmultilateralsolutions, pursue principallytransactionalapproaches, evenasthey multilateral institutionalframeworkbuiltinthepost-WWII peting multilateralinstitutionshavebeensetup,resulting in regional multilateralinstitutions iseroding whilenewcom refers tothesupposedlyinevitabletensionbetweenan power hasalsobeenacontributingfactortotherevival institutional architecture, which could seriously weaken the institutional realm, thecredibility oftraditionalglobaland orderin thebeliefarules-basedinternational and 6. Allison2017. based approach toglobal relations andthestrengthening between ChinaandtheUS,istherefore seenbysome 5. Osnosetal.2017 http://indianexpress.com/article/india/brics-summit-2017-full-text-of-decla lence oftheso-called“ThucydidesTrap,” where the“trap” last 70years,theconvergenceineconomicandpolitical The UKreferendum approving Brexit andtheelection In the national political spheres acombination of 5 Historianshaveobservedthehistoricalpreva 6
7 Even For - - - of Russia’s President ontheeveofBRICS2017Summit.Asumma Germany, whichsinceWWIIhasgenerallybeenstaunchly emanating from geopolitical, political, and institutional global multilateralfinanceanddevelopmentinstitutions or not,butthatwebetteractasifthethreats are long-term conservative fiscalstanceonitsEUpartners,despitewide- and seriousinnature, forifweare wrong inthepresump spread criticism. international sued animplicit“GermanyFirst”policyinregard torunning supportive ofmultilateralapproaches, hasineffect pur domain. modi-s-10-mantras-to-anti-terrorism-things-to-know-117090500480_1.html we cannotbesure whether thecurrent trends are cyclical tion thattheyare cyclicalandthattheytherefore cansafely forces. The next section considers in some detail the ry ofIndia’s PrimeMinisterModi’s “10NobleCommitments” isfoundat more ontheSummitseeWatt (2017).AlsoseePutin(2017)forastatement persistent current accountsurplusesandimposingits the complexpursuitofChina’s nationalinterests intheglobalinstitutional interrelated questions: Ikenberry andLim(2017)Prasad present goodassessments of be ignored, the damage to the world could be catastrophic. http://www.business-standard.com/article/current-affairs/brics-summit-from- This paperfocusesspecificallyonthepressures onthe The core hypothesistobe explored inthispaperisthat Looking ahead,thesetrends raisefourfundamental, 1. 4. 2. 3. quest forpreserving nationalsovereignty and Geopolitical of authoritarianregimes, bringingwithitagreater ocratic politicsandinstitutions spread further, can theybelargelyignored inthehopethatthey geopolitical multipolarity and with it perhaps a and/or result in the rise or further strengthening addressed, before itcauseslastingdamagetothe severely weakenedovertime andunabletomeet will eventuallywane;ordotheyreflect along- to thoseduringthefirsthalfof20 tinuation ofthetrend towards geoeconomic and term trend thatmustbe actively andforcefully the growing globalchallenges? Institutional ments tosupportglobalmultilateralsolutionsand revival ofglobalconflictamongbigpowers,similar progress of addressing the key challenges faced undermining thewillingnessofnationalgovern undermine nationalstabilityinmanycountries, Political Dynamics institutional threats ofacyclical nature, andhence institutions? by agloballyinterconnected world. : Will thecurrent crisisofnationaldem : Will : Are these geopolitical, political, and : Will themultilateralinstitutionsbe : Will : Will thecomingdecades see acon : Will th century? ------. CURRENT AND FUTURE THREATS TO MULTILATERALISM: CAUSES AND POSSIBLE REMEDIES 3 ------
11 However, over the last few years rising geopoliti over the last few years rising However, The opening up of China and the fall of the Soviet Soviet of the The opening up of China and the fall lennium Summit and the agreement on the Millennium on the Millennium lennium Summit and the agreement have undermined the non-political status of the IFIs. The The the IFIs. of non-political status undermined the have hubs and data managers, and advocates, financiers and hubs and data managers, and advocates, know-how, and innovation. Moreover, with globalization globalization with innovation. Moreover, and know-how, of this section. in the remainder be explored Development Goals in 2000, by the Monterrey Summit on Development Goals in 2000, by the Monterrey agreement the by and 2002, in Development for Financing Development, and the Paris climate agenda in 2015. The nentially, in terms of trade, private capital flows, transport, capital flows, transport, of trade, private in terms nentially, report from “Millions to Trillions” in support of the Addis in support of the Addis “Millions to Trillions” from report resources, production and export capacity, technological capacity, export and production resources, and socioeconomic devel adjustment, macroeconomic global public bads. How public goods and help prevent IFIs were able to adapt to the changing needs of global able to adapt to the changing needs of global IFIs were their membership and – esp. in the case of the IMF and of the IMF and their membership and – esp. in the case miracle in China tutions. Their support for the economic by the Mil as represented the international community, the interdependency among all countries has grown expo has grown among all countries the interdependency Geo-economic/political factors in consensus was a growing there since their creation, serve as sources of policy advice, catalysts of private finan private of catalysts advice, policy of sources as serve World Bank and the European Bank for Reconstruction Bank for Reconstruction Bank and the European World affected most directly and Development (EBRD) were World Bank – to become truly global membership insti membership global truly to become – Bank World East and Central in countries the of recovery the for and in their joint reflected as most recently and as a group, adapting their role as public financiers for financial stability, financiers for financial stability, as public adapting their role cal tensions have resurrected the East-West divide and and divide the East-West cal tensions have resurrected empire made it possible for the IFIs to significantly expand made empire turnedern them into valued partners for these Europe social, and countries. While global economic, financial, challenges changed over the decades environmental on the Agenda 2030, the Addis Agenda on Financing for communications and exposure to “global public goods” to “global public goods” exposure communications and the function of the IFIs – their rank etc.). At the same time, by the addition of the regional expanded over the decades developing countries, they now also opment of individual regional knowledge cial flows and investment, global and action to support global of global (and regional) guardians, will that the IFIs face multiple challenges and threats ever, (e.g., shared knowledge) and “global public bads” (epi knowledge) (e.g., shared financial stability and development challenges individually demics, natural disasters, global warming, financial crises, demics, natural disasters, also changed. While maintaining anddevelopment banks – Agenda. 11. See James (2017); World Bank (2015). 11. See James (2017); World
------8 Each of 9
10 Since Bretton Woods, the world and the IFIs have have IFIs and the the world Woods, Since Bretton Created at the end of WWII at the Bretton Woods con Woods the end of WWII at the Bretton at Created This section reviews how the four factors and questions how the four This section reviews is a specialized UN agency. 9. The traditional regional development banks include the African Develop development banks include the African 9. The traditional regional Institutions 8. This paper does not consider purely regional multilateral arrangements, regional 8. This paper does not consider purely has become blurred, as many of the latter – and especially has become blurred, been dominated by their North American, European, and been dominated by their North American, European, known as “under-developed” nations. Both institutions nations. Both institutions known as “under-developed” identified in the introduction – geopolitical, political, institu political, geopolitical, – introduction the in identified international financial institutions (in particular, the IMF and the international (in particular, financial institutions for Reconstruction and Development (EBRD) and the Inter-American De for Reconstruction and Development (EBRD) and the Inter-American ties consistent with the high-level analysis in this section, see Camdessus until today, the governance has of these two institutions until today, ment of countries encountering macroeconomic crisis. The crisis. macroeconomic encountering countries of ment then were what of development the of and reconstruction multilateral developments share many common traits and multilateral developments share review the United Nations, trade and the World Trade Trade World trade and the the United Nations, review ment (IFAD) is also generally recognized as a global IFI, even though it also it though even IFI, global a as recognized generally also is (IFAD) ment ment Bank (AfDB), Asian Development Bank (AsDB), the European Bank European the (AsDB), Bank Development Asian (AfDB), Bank ment velopment Bank (EBRD). The International Fund for Agricultural Develop ference in 1944, the IMF’s role was and still is today to today to is still and was role IMF’s the in 1944, ference the stark line between advanced and developed economies the Asian “tigers” – have come a long way in closing the that suffered temporary or long-term financing deficits, par deficits, financing or long-term temporary suffered that and on early From world. developing the in those ticularly these organizations, of course, has its own pressing issues pressing these organizations, of course, has its own And while the that cannot all be dealt with in detail here. tional, and dynamics – apply to the key global and regional – apply to the key global and regional tional, and dynamics the multilateral development banks). Subsequent sections Subsequent sections development banks). the multilateral were to – and did – create access to finance for countries access to finance and did – create to – were way forward. such as the EU, ASEAN, etc. and Singh (2017) and Boorman (2017). For more detail on the history and and Singh (2017) and Boorman (2017). For more evolving role of the MDBs, see Center for Global Development (2016). of the MDBs, see Center for Global Development evolving role safeguard the stability of the internationalsafeguard monetary system World Bank’s role was to support the financing of post-warsupport the financing to was role Bank’s World and the development of trade, and to support the adjust the support and to trade, the development of and and the traditional Regional Development Banks. and the traditional Regional Development gap with the former as regards living standards, financial financial standards, living regards as former the with gap greater share of the financial resources of these institutions. institutions. these of resources financial the of share greater changed. With the rise of the emerging market economies challenges, many of which are noted in this section, those challenges, many of which are in many ways sui generis. of the IMF are Organization, the Paris climate agreement and the Green and the Green agreement the Paris climate Organization, financial institutions (IFIs), i.e., the IMF, the World Bank, World Bank, the financial institutions (IFIs), i.e., the IMF, Climate Fund, and the G20 in somewhat lesser detail. Climate Fund, and Threats to the International Financial Threats A concluding section considers the implications for the considers the implications for the A concluding section 10. For a detailed assessment of the IMF’s challenges and opportuni challenges IMF’s of the assessment a detailed For 10. Japanese members/shareholders, as they contributed the Japanese members/shareholders, JOHANNES F. LINN, DISTINGUISHED RESIDENT FELLOW, EMERGING MARKETS FORUM 4 Tiananmen Square protestsTiananmen in1989.Suchgeopolitically 13. Ahluwalia2017. 12. Prasad2017;IkenberryandLim2017. Asia; (c)thecreation oftheAsianInfrastructure Investment development financeneeds,including(a) reliance on dominance intheIFIs,emergingmarketcountrieswere driven actionsbysomeoftheIFIsreminded theemerging ening ofexistingregional developmentfinanceinstitutions countries alsoseekareduction ofWorld Banklendingto cial crisis;andbytheapparent skewingofIMFsupportto continued practiceofhavingnationalsfrom Europe, Japan, economic balanceawayfrom theWest andhencethere is after theEastAsiacrisis;(b)establishmentofnew and theUSselectedforleadershipofkeyIFIs(IMF, World West more generally, around theglobe. a growing interest amongsome of them,especiallyChina, after theChinesegovernment’s violentresponse tothe annexation ofCrimeain2014.Asimilar, albeitshort-lived, when emergingmarketsseeadramaticshiftintheglobal when theyhadtostoplendingRussiainthewakeofits with renegotiating votingshares intheIMFandWorld Bank the auspices of the BRICS countries, and the Eurasian the ChiangMaiInitiativeforbalanceofpaymentssupportin waysofmeetingtheir tries havebeguntoseekalternative the World Bank in the wake of the 2008/9 global finan to reflect theshiftingglobaleconomicbalances; to challengetheperceived hegemonyoftheUS,and frustrated by the drawn-out process and limited progress Upper MiddleIncomecountries. regional financialarrangementsandinstitutions,suchas peans andtheUStosupportamajorcapitalincrease for market countriesthattheseinstitutionsremain dominated Development Bankledby Russia; and(d)thestrength Bank ledbyChina,theNewDevelopmentunder East Asiafinancialcrisis–whilekeyindustrialmember European countriesinfinancialcrisis – incontrasttoits Bank, AsianDevelopmentBankandEBRD);bythepro increasing theirownreserves asawayofself-insurance increase for the IMF, andthe unwillingness oftheEuro by theiremergingmarketmembers(includingtheIslamic by Westerninterests, andinparticularbytheUS,atatime break in World Bank lending to China had taken place heavy-handed engagement in East Asia during the 1998 longed inability ofthe USto implement anagreed quota Aside from these politicalexamples ofWestern It istherefore nosurprisethatemerging market coun 12
13 bythe - - - - - – thesoft-loanbranchofAfrican Development Bank)by15percent. 16. The US reportedly announced in mid-2017 that it would reduce its 15. Notetherisingshare ofearmarkedfundingformultilaterals(Jenks 14. Linn 2014; Ikenberry and Lim 2017. In these initiatives the emerging gov.uk/government/speeches/theresa-mays-speech-to-the-un-general-as outright supportfrom theUS. of DFID’s core resource pledgesondeliveryagainstcertain specified re And recently theWorld Bankannouncedthatitwouldnotseekacapital (in particularDenmark,Sweden,andSwitzerland).Anda versus earmarking(linkedtospecificbilateral results of highincomecountriesandresponsible forjoblossesin countries are increasingly seenaseconomiccompetitors years bygrowing nationalistic/populistpoliticalpres opment assistancethathavebeenexacerbatedinrecent engagement intheIFIs.There remains muchuncertainty agreements betweenindividual donorandthemultilateral a timewhenthere hasbeenmuchprogress inreducing advanced countries.Thesetensionincludedebatesabout accounts. about the Trump Administration’s and the US Congress’s alistic andpopulistpressures athome,thelesslikelyisit agency). severe poverty in the developing world and middle income sures anddebatesabouthowtodealwithimmigrationin ditional resource mobilizationefforts oftheIFIs. decades setupitsownregional financingstructures, ineffect competing sembly-2017 agreements betweenDFIDanditsmultilateralpartners,whichmakesparts and Kharas2017).TheUKhasrecently startedpushingforperformance speech totheUNGeneralAssemblyonSeptember20,2017( sult benchmarks. This approach was confirmed in Prime Minister May’s traditional industries,andwhenlargenumbersofrefugees development, especially at tic needs versus international the appropriate balancebetween(a)supportingdomes that a government willsupportmultilateraldevelopment that agovernment from conflict-affected regions havetobeabsorbed;(b) funding mechanisms. Examples include recent cutbacks National politicalfactors pledges to the International DevelopmentAssociation(IDA–the soft-loan pledges totheInternational market economiesfollowtheleadofEuropean Union,whichoverthe rity focusversusdevelopmentfocus;and(d)core funding multilateral institutions,butindicationsare thatthere could positions on the budgetary allocations for USAID and for particular challengeisnowthepossiblereduction ofUS port forthesoft-loanwindowsofselectedtraditionalIFIs now renamed theDevelopmentBankofLatinAmerica). Development Bank, the Caja Andina de Fomento or CAF, with thetraditionalIFIs,including the European Investment Bank and the in pledgesby selected European in their sup governments bilateral versus multilateral assistance; (c)political/secu be substantialcutbacksonbothbilateralandmultilateral European StabilityMechanism. increase forIBRDintheimmediatefuture, veryprobably duetothelackof branch oftheWorld Bank)andtotheAfricanDevelopmentFund (ADF There are manylong-standingtensionsaround devel For eachofthesetensions,thestronger thenation 15 16
). Thisapproach may undermine themultilateral nature of tra Giventhelargerole thatUSengagementhas https://www. 14
------CURRENT AND FUTURE THREATS TO MULTILATERALISM: CAUSES AND POSSIBLE REMEDIES 5 - - - - The The 18 Indeed, 19 The IBRD, IFC, AfDB, and EBRD EBRD and IFC, AfDB, IBRD, The 17 The capital market based funding model of the multi model of the The capital market based funding lem that the IFIs overall are severely constrained in their constrained in their severely lem that the IFIs overall are success story of lateral development banks (MDBs) is a to the bilateral leveraged development finance (in contrast require capital increases, if they are to meet the needs needs the meet to are they if increases, capital require Institutional factors fund approach of the soft-loan windows of the MDBs, MDBs, the of windows soft-loan the of approach fund total of twenty-five dollars in funding by the Bank. in funding total of twenty-five dollars ture investments, for supporting the achievement of the of the supporting the achievement investments, for ture of global climate change. to meet the challenges Sustainable Development Goals (SDGs), and for helping Goals (SDGs), and for helping Sustainable Development such as IDA). Estimates for the US show that one dollar dollar one that show US the for Estimates IDA). as such sional window with those of its non-concessional window, window, non-concessional its of those with window sional and UN grant approach, and to the traditional revolving revolving traditional the to and approach, grant UN and and IDA was authorized to tap into capital markets based and IDA was authorized but should not mask the underlying prob welcome, are of grant support by the US to the World Bank leverages a of grant support by the US to the World of their member countries, especially for global infrastruc countries, especially of their member the to improve efforts These assets. on its accumulated financial crisis hits. crisis financial due to the without a capital increase, financing capacity of combining the assets of its conces financial innovation the multilateral development windows financial leverage of to the tasks they face. relative finances Asian Development Bank recently was able to increase its was able to increase recently Asian Development Bank 17. Boorman 2017; James 2017. 18. Boorman 2017. and for an extensive 19. See Morris and Gleave (2015) for these numbers ------Declining resource position of the IMF Declining resource Boorman 2017. Such a potential decline in funding for multilateral orga Such a potential decline As a result, many of the traditional IFIs are now now many of the traditional IFIs are As a result, Figure 1: 1: Figure liquidity and serve as the lender of last resort when global liquidity and serve as the lender of last resort by growing contributions from emerging market coun from contributions by growing in general, and from multilateral assistance in particular, in particular, multilateral assistance and from in general, nizations. But such efforts are either blocked by resistance by resistance either blocked are nizations. But such efforts nizations by traditional donors could be made up in part donors could be made up in part nizations by traditional percentage of external liabilities (Figure 1). It needs a fur of external 1). liabilities (Figure percentage multilateral institutions in which they dominate the deci in which they dominate multilateral institutions reduce emerging market countries’ access to IFI funding. emerging reduce Instead, these new donors understandably support those Instead, these new donors understandably IFIs (as in the case mentioned earlier for the IBRD capi IFIs (as in the case mentioned earlier for from traditional donors who fear dilution of their capital who fear dilution of their capital traditional donors from the IMF has seen a dramatic drop in its resources as a as a in its resources the IMF has seen a dramatic drop manage global to allow it to effectively ther quota increase tal increase after the 2008/9 financial crisis); or they are the 2008/9 financial crisis); or they are after tal increase tries, who have in fact been increasing their development been increasing tries, who have in fact their core funding models are based on the principle of based on the principle of are funding models their core traditionally played, its retreat from development assistance development from played, its retreat traditionally sion-making process, as noted above. sion-making process, shares and votes and hence of their control over the the over control their of hence and votes and shares assistance in recent years, including for multilateral orga multilateral for including years, recent assistance in could lead to a downward ratcheting in the assistance by ratcheting in to a downward could lead since institutions, especially for multilateral other countries member countries. sharing among equitable burden financially constrained. Despite the approval by the US by the US financially constrained. Despite the approval on in 2010, agreed in 2015 of the quota increase Congress discouraged by an explicit push of traditional donors to donors to discouraged by an explicit push of traditional Source: JOHANNES F. LINN, DISTINGUISHED RESIDENT FELLOW, EMERGING MARKETS FORUM 6 on climatechangebelow). of theIFIsinparticular, ofthelegacyadjustmentlending NGOsandacademicsofthesup critiques bynorthern effectiveness of the multilateral institutions. Decades of of smallerEuropean countries,besubstantiallyreduced, eyes oftheemergingmarketcountries.Atsametime, of theIFIs(voiceandvote,leadershipselection,etc.)have expansion ofmultilateraldevelopmentfinancingchannels of developmentfinanceandassistance(NGOs,founda actors, created overlapandduplication inorganizational and injectedahealthysenseofcompetitionamongmul a few)andwithgrowing competitionfrom otherchannels aid architecture, withtheriseofnewregional development scale, esp. as regards achievement of the SDGs and of structures, structures aswellriskstonot changingthem. should the voice of overrepresented countries, especially dates oftheMDBsinagriculturalsector; andtheGreen ClimateFund, explanation of the benefits of the WB for donor governments; thesame explanation ofthebenefitsWBfordonorgovernments; also setupin2010,duplicatingsignificant aspectsoftheGlobalEnviron there are risksinvolvedinchangingtheIFIgovernance this could well lead to an erosion of interest in and support the climatemitigationandadaptationgoals. tilateral and bilateral channels of development assistance. tions, privateinvestors,etc.).Thedramaticandcontinuing the IBRD has been so widely copied over the decades, for theIFIsinEuropean capitals.So,onewayoranother, IFIs haveplayedinthepast,andcouldplayfuture in mental Fund(GEF),aswellthemandates oftheMDBs(seealsosection response tothetransitioninformercommunistcountries, posed socialandenvironmental sinsofaidingeneraland ronmental Facility, theGlobalFundforHIV/AIDS,TBand perhaps thegreatest demonstrationofthisextraordi undermined thelegitimacyoftheseinstitutionsin nary leveragingeffect isthattheoriginalMDBmodelof 21. Linn2015. 20. Examplesfor this are thecreation ofthe Global Agriculture and Food But italsohasincreased theburden onreceiving countries Malaria, GAVI, andtheGreen ClimateFund,tomentionjust would broadly applytootherMDBs. Security Program (GAFSP) set up in 2010, duplicating the mandate of the in managing this rapid rise of international development in managingthisrapidriseofinternational is undoubtedlyagrowing fragmentationoftheinternational including therecent formationofAIIBandNDB.Butthere International FundforAgriculturalDevelopment(IFAD)International aswelltheman by theWorld BanktoAfricainthe1980s-90s,ofIFI banks and of new vertical funds (such as the Global Envi helping countriesmapoutdevelopmentstrategies,mobi has increased the overall multilateral resource envelope lize resources, andcoordinate theirimplementationat As alreadystructures noted,theinflexible governance Finally, there are recurring questionsregarding the 20 andthreatens theanchorrole whichoriginal 21
------cusing onbroader strategicissues. comparative advantage,theirvalueformoneyand other multilateralandbilateralaidorganizations, over thethree-year period2012-2014 clash withthoseofthestatusquopowers,Europe, Japan of this,therecurrent clamorindonorcapitalsthatIFIsare adaptation; gender, youthandhandicapped;etc.);tofur are continuouslypressured bytheirOECDdonorstoadd and oftheIMF’s response totheEastAsiafinancialcrisis– also belong-terminnature, asthegrowing influenceof among thedonorpublics. show that the IFIs perform very well in comparison with will very likely continue (see Figure 2). tary effect onthequalityof the IFIs’operationaldelivery, as transparency. ther enhancetheirresults focus;andtodemonstratetheir to clientdemand. to citejustafewofthemore prominent challenges the risingpowers,andespeciallyofChina,willcontinueto towards the emerging market economies and towards Asia, tors are cyclicalorlong-terminnature? Thegeoeconomic the trustandownershipamongrecipient countries.Ontop take risksoftheinstitutions,andtheyhaveundermined factors, i.e.,thecontinuingrebalancing ofeconomicpower Dynamics ofprevailingtrends more intensiveevaluationthanmostoftheirbilateralcounterparts. member governments –205assessmentsofmultilateral member governments reformed, also undermines the trust in these institutions marks. Buttheyalsohavetheunintendedsideeffects of measured byshareholder ordonorperformancebench new responsibilities (humanrights;climatemitigationand negatively affected theIFIs’“brand”ineyesofpub not performingwellenoughandneedtoberepeatedly undermining responsiveness, flexibility, and readiness to 27. Kohli2017. 26. CenterforGlobalDevelopment2016. LinnandSood2016alsonote 25. Ibid. 24. OECD 2016; these assessments are on top of the extensive evalua 23. CenterforGlobalDevelopment2016. 22. See,e.g.,Stiglitz2002;Easterly2007. Partly inresponse tothesecriticisms,theinstitutionshave themselves excessively in micro-managing the institutions, rather than fo that aspartofsoft-loanfundreplenishment processes donors involve tions bythemultilateralinstitutionsown independentevaluationoffices and institutions were carriedoutbyDACmembercountries in regard tosocialandenvironmental safeguards, which ical trends – in particular the “newcold war” – could well been forced toadoptburdensome operationalpractices have madethemcostly, long-winded,andunresponsive inspection panels.There islittlequestionthattheIFIsare subjecttomuch lics and parliaments in donorand recipient countries alike. How aboutthequestionofwhethersomethesefac 26 Thesepressures haveundoubtedlyasalu 23 Andeventhoughassessmentsby 27 And the geopolit 24 —universally 22 – have –have 25 they ------CURRENT AND FUTURE THREATS TO MULTILATERALISM: CAUSES AND POSSIBLE REMEDIES 7 - - -
28 http://www.oecd.org/dac/ The Eminent Persons Persons Eminent The 29
ing those measures recommended by the recent recent the by recommended measures those ing Development Banking. Development report of the High Level Panel on Multilateral Multilateral of the High Level Panel on report of multilateral funding channels. It proliferation partnerships among IFIs, and with other national to focus instead on clarifying and streamlining to focus instead on clarifying and streamlining includ the mandates of the existing institutions, should also consider how to ensure more effective effective more should also consider how to ensure at the Hamburg G20 Summit in July 2017 is an at the Hamburg G20 Summit in July 2017 is an and international especially with the partners, expansion of multilateral finance institutions, and and expansion of multilateral finance institutions, division effective more a on focus to body excellent of labor among IFIs and other multilateral organi Governments should recommit to limit any further any limit to Governmentsrecommit should on Global Financial Governance set up Group zations and funds, and on how to limit continued • Specific opportunities include the following: liferation of these channels and will, by the end of 2012, agree on principles liferation of these channels and will, by the end of 2012, agree in their ability to deliver financial services in response to response to in in their ability to deliver financial services focusing on those that are performing well. We will work to reduce the pro the reduce to work will We well. performing are that those on focusing the coherence of our policies on multilateral institutions, global funds and of our policies on multilateral institutions, global the coherence 28. The recent report by the Bill & Melinda Gates Foundation (2017) makes report 28. The recent 29. Center for Global Development (2017). The Busan High Level Forum potential client demand and huge global needs. potential client demand and huge global recent decades, this progress is at risk looking ahead to 2030. decades, this progress recent will improve multilateral aid channels. The Busan Declaration states: “We use of existing multilateral channels, will make effective We programmes. their members; and as they could be seriously constrainedtheir members; and as they could be seriously and guidelines to guide our joint efforts.” (p. 7) and guidelines to guide our joint efforts.” as they may confront reduced trust and engagement of of engagement and trust reduced confront may they as clear that while there has been much progress in global living standards in in global living standards has been much progress clear that while there committed to tackle the fragmentation in already on Aid Effectiveness effectiveness/49650173.pdf - - - China and India will be by far the largest economies in 2050 far the largest India will be by China and % % % % % % 0 0 0 0 0 0
5 0 5 0 5
2 2 1 1 l e v e l S U f o t n e c r e p s a 0 5 0 2 n i P D G Centennial Group International 2017. International Group Centennial Overall, therefore, it is safe to assume that the IFIs and it Overall, therefore, Figure 2: Figure have to function with respect to governance,have to function with respect operational being starved of new quota contributions for the IMF and identified above in regard to geoeconomic/political, political, regard identified above in istration may end up being less severe than feared and/ than feared istration may end up being less severe ism, populism and authoritarianism – around the globe are the globe are ism, populism and authoritarianism – around But more likely than not, deep chasms among competing But more risk sapping strength from the traditional IFIs as they are are they as IFIs traditional the from strength sapping risk policies, and performance expectations. political visions and movements will continue to create a a to create continue will movements and visions political perhaps cyclical. Anti-EU sentiments in Continental Europe Europe perhaps cyclical. Anti-EU sentiments in Continental US and the focus on recapturing or preserving national national preserving or recapturing on focus the and US factors, these appear to reflect largely long-term trends in largely long-term trends factors, these appear to reflect their soft-loan windows may face declining replenishments; their soft-loan windows may face declining replenishments; their governing to learn bodies will have to live with and the development of the international development archi under which IFIs and in the tensions and pressures tecture the radical nature of the anti-globalism of the Trump admin of the anti-globalism of the Trump the radical nature Source: Challenges and opportunities stalemate in the national political sphere in Europe and the in Europe stalemate in the national political sphere the institutional will likely continue. As regards sovereignty seem to be waning following the UK’s Brexit decision, and Brexit seem to be waning following the UK’s adjust to the challenges of the potential long-term trends adjust to the challenges of the potential long-term trends developments these and institutional factors. Cumulatively, and especially the US. National political trends – national trends and especially the US. National political of new capital for the MDBs’ hard-loan windows, and as of new capital for the MDBs’ hard-loan or create a backlash that will eventually result in a return return a in result eventually will that backlash a create or for globalization. of the US to its long-standing support JOHANNES F. LINN, DISTINGUISHED RESIDENT FELLOW, EMERGING MARKETS FORUM 8 countries. Consideringthehugeinfrastructure investmentneedsandpo omy betweenglobalandnationalengagementisinfactmeaningless,since gional development banks deal with country-level investments. This dichot extensively inhighincomecountrieswould greatly improve its impactas all interventions – whether for global or national goals – need to be imple mean thatitwouldnotbeabletoengageinsupportingglobalpublicgoods mented through national-basedprograms andprojects. Thus,eliminating nancial modelisbasedontheMDBblueprint, isveryengagedinallEU well asworld-wideacceptanceoftheBank asaglobalplayerinsupportof through itsfinancialoperationsandknowledgeactivities. the World BankGroup’s engagementatthenationallevel would inpractice the World BankGroup shouldfocusonglobalpublicgoods,whilethere tion inhighincomecountries,allowing theWorld Banktoengage more tential investmentrequirements ofclimatechangemitigationandadapta 32. BoormanandIcard (2011). 31. The World Bank is already active in selected high-income countries, 30. CenterforGlobalDevelopment(2016).However, oneaspectofthe High LevelPanelsrecommendation needstobetreated withcaution:that including membersoftheEU.TheEuropean InvestmentBank, whose fi key globalinvestmentrequirements. • • The governing boards oftheIFIsshouldexploreThe governing governments canassuregovernments asustainedresponse. only increased financialcommitments bymember cial sustainabilityandtheirAAArating.Ultimately, examples ofAsianDevelopmentBankwithits effectively engagedinaddressing globalopportu countries. of developingcountries,butalsofortheadvanced goods asrecommended bytheCGDHighLevel as IFIsmustnotputatrisktheirlong-termfinan are prudentiallimitstothisincrease inleverage, addressed, soastoenhancetheircredibility and shareholders shouldconsiderwhetherandhow work andevenfinancing)notonlyforthebenefit the leverage of their existing equity, following the trust amongallmembers. arrangementneedtobeurgently their governance the World Bankcanoperate(intermsofadvisory assistancein the developmentimpactofexternal the interest ofeffectively supportingscalingupof focus andmore effective fundingofglobal public for theirfinanceexpands(astheyundoubtedlywill), In the case of the World Bank, a more explicit move toward market borrowing. However, there merger of balance sheets for its soft-loan and mendations of the Palais Royal Initiative should pursuit oftheSDGs. private sector, atthecountryandgloballevelsin mandate ofthetraditionalIFIsismaintained(asit undoubtedly should) and the needs and demand nities andchallenges,thecontinuingimbalancesin Panel onMDBsshouldbeexplored. Most importantlyintheimmediatefuture, capital if the global financial stability and development be fullyconsidered. hard-loan windows,andofIDAwithitscurrent lessening thefinancialconstraintsbyimproving 31 InthecaseofIMFrecom 32 Forbothinstitutionstobe 30 Beyondthis, ------The UnitedNations(UN) decision making,funding,crisisresponse, andconflict res discussion is possible. For a full assessment, major individ financing, research anddatacollection. olution. Atthesametime,UN’s importanceasaforum and thepotentialfora“newColdWar” will likelyhamper and related agencies,but even fortheseonlyahigh-level and fundsinvolvedinnormsetting,disputesettlement, social development,withsome34departments,agencies, spanning globalsecurity, conflict resolution andpeace South dividethatprevailed attheUNinprevious decades the effective functioningoftheUNsysteminterms for addressing geopolitical tensionsand global challenges ual agencieswouldhavetobeconsidered insomedepth. 34. JenksandKharas 2016. 33. IFIsalready cooperateinsomeof theseareas, e.g.,evaluation. in thissectionfocusesontheUN’s developmentagenda become lessdeep,buttherevival oftheEast-West conflict between OECDcountriesandtheG77appearstohave keeping, refugee anddisasterrelief, andeconomic The UNsystemhasavastarrayofresponsibilities, Among • • All responsible actorsengagedwiththeIFIsmust challenges. and publics.Itisessentialthatthedemonstrated as regards capital increase and replenishment and problematic shareholder pressures, and as tominimizetheriskofgoldengeesegetting as widelyshared andunderstoodaspossible so success ofthemultilateralapproach oftheIFIsbe seeking effective solutionstoshared governance strategize inresponse tothemore burdensome starved forlackofappreciation ofthegoldeneggs they produce. for theIMF. IFI managementsshouldcooperateandjointly responsible ministriesvis-a-vistheirparliaments ments vis-a-vis their Executive Board members, models of the IFIs (IMF and MDBs) – manage requirements. Theyshouldalsocollaborateon processes, operationalpoliciesandevaluation regional development banks and a quota increase Board membersvis-a-vistheircapitals,and increases are essentialforIBRD andIFC, benefits ofthemultilateralandcollectivefinance be ready to demonstrate more effectively the beyond this, capital increases for some of the geopolitical factors 33
, thetraditionalNorth- 34 Thediscussion - - - - CURRENT AND FUTURE THREATS TO MULTILATERALISM: CAUSES AND POSSIBLE REMEDIES 9 - - - - Certainly, Certainly, 37 Moreover, the Moreover, 38 There also have been There 36 of these trends, as for the IFIs, of these trends, dynamics As regards the As regards have great strengths in their respective areas of engage areas in their respective strengths have great it appears that most are of a long-term nature, rather than of a long-term nature, it appears that most are 36. DFID (2016). 37. Jenks and Kharas (2016). 38. DFID (2016) reliance on earmarked funding relative to core financing, financing, to core funding relative on earmarked reliance innovative financial models developing ment, and are UN agencies, including IFAD, UNDP, UNICEF, and WFP, and WFP, UNICEF, UNDP, IFAD, UN agencies, including of the Agenda 2030, Addis Agenda, UN led the process these institutional issues have been around for a long time, have been around these institutional issues the international community. sion in 2015, which represented a major achievement for a major achievement for sion in 2015, which represented address exploring how to cyclical. Hence, or short-term about the effectiveness of the UN development agencies, of the UN development effectiveness about the of staffing. and the uneven quality the fact that individual not obscure although they should conclu successful a to Agreement Climate Paris the and cies, their unleveraged financial model (grant based), their based), (grant model financial unleveraged their cies, concerns the weakening ability of UN agen voiced about agencies. norm-setting cies to serve as effective (financial leverage, crowd financing, etc.). financing, crowd (financial leverage, due to their fragmentation both across and within agen within and across both fragmentation to their due - - - - - https:// , nationalistic/popu , while for the UN there are are , while for the UN there political factors ) Share of US in UN Funding Share institutional realm
35 Kharas 2017a. In the Among the national Among the Figure 3: Figure his speech to the UN General Assembly on September 20, 2017. ( his speech to the UN General Assembly on September list trends will tend to undermine countries’ support for the undermine countries’ will tend to list trends transcript-un-general-assembly ian and peace keeping areas, but also in health and food and health in also but areas, keeping peace and ian in a peaceful and productive way will rise as these tensions way will rise and productive in a peaceful 35. President Trump lambasted “mammoth, multinational trade deals, un Trump 35. President www.vox.com/policy-and-politics/2017/9/19/16333290/trump-full-speech- ment efforts. A special problem is the possible collapse of is the A special problem ment efforts. UN, and especially for its social and economic develop UN, and especially in the UN. The US is a criticalUS support and engagement funding needs of the UN remain uncertain at the time of the time of at uncertain remain of the UN needs funding fewer debates about the fairness of the governance struc funder for selected agencies (especially in the humanitar the in (especially agencies selected for funder ture than for the IFIs given the more effective representation representation effective than for the IFIs given the more ture that the Trump Administration appears to be supportive of supportive be to appears Administration Trump the that is an encouraging agenda, reform General’s the Secretary writing. accountable international tribunals, and powerful global bureaucracies” in accountable international tribunals, and powerful global bureaucracies” security, and for the UN core budget (Figure 3)). The fact (Figure budget core and for the UN security, of the US to the of the approach signal, but the details and the challenges – including climate change – rise. – including and the challenges of developing countries, there are longstanding questions longstanding questions are of developing countries, there Source: JOHANNES F. LINN, DISTINGUISHED RESIDENT FELLOW, EMERGING MARKETS FORUM 10 40. Anindependentevaluationofthiseffort concluded:“’Deliveringas 41. document/download/1557 one hasbeenareal-world testingground foranambitiousagendaa financial transactions(“Tobin tax”)mightbeoptimal,thisis disaster response functions,todrivetheglobaldevel of individual agencies, based on the lessons learned fromof individual agencies, based on the lessons learned vasive politicalandbureaucratic obstacles.Special effort effect, grammatic integration across UN agencies at the country, effectiveness oftheUNagencies.One direction would grant modeltowards more financialleverage andinnova opment and climate agendas, and to carry out its norm are esp. as regards limitedalternatives, raisingagreater anti-tax and“AmericaFirst”sentimentsintheUS.There as amultilateralinstitution. system-wide reforms are worthwhileinprinciple,theyare sued through the“OneUN”reforms undertheprevious social ordevelopmentimpactbonds(asalready practiced share ofcore resources, butmovingbeyondthepure setting andinformationdatagatheringfunctions.Of system is foremost the need to ensure its continued abil Secretary General(SG)with some,butapparently limited posals-for-reform/ pact-bond-launched-transform-financing-aid-conflict-hit expected from theUnitedNationssystem.”(p.28) the more successful ones, and to worktowards improved therefore shouldbedevotedtoimproving thefunctioning tive financingmechanisms,suchascrowd fundingand these challenges will be important for the future of the UN fundamental importancewillbeamore effective funding modalities; andanewdefinitionofthe rangeofdevelopmentexpertise measures mayberequired toputthe United Nationsonamore compre principles ofwhichwere announcedinthe2005World SummitOutcome. more coherent and effective United Nations system at the country level, the partnerships among agencies and with other key stake rent SGinarenewed UNreform initiative. regional, and global levels. These objectives were pur politically unrealistic atthistime,esp.withtheprevailing model fortheUN.Whileideallyaglobaltaxoninternational tee oftheRedCross (ICRC)ofthelaunchitsfirsthumanitarianimpact 39. Notealsotherecent Commit announcementbytheInternational in practice extremely difficult to carry through due to per ity to support the conflict resolution, peace keeping, and be to aim for more consolidation, coordination, and pro by someUNagencies),mayprovide somerelief. holders inspecificcountry, regional, andglobalprograms However, whileitsefforts atreform are mostlypositivelyassessed,bolder Nations entities;reform structures ofmandates,governance andfunding in Africa.( bond, raisingCHF26millionforthree newphysicalrehabilitation centers hensive trackofreform, includingrationalizationofthenumber United Among the Equally important will be efforts to demonstrate the http://sdg.iisd.org/news/governments-react-to-secretary-generals-pro 40 andtheyare nowbeingpursued againbythecur https://www.icrc.org/en/document/worlds-first-humanitarian-im
challenges andopportunities
www.unevaluation.org/ ) 41 Whilesuch for theUN 39
------Trade Organization(WTO)bore outthisview. Emerging 47. Agarwal(fragmenting globaleconomy);Lamy(2017). 46. Thesehaveareach ofalimitednumberpartners,rather thana 45. HufbauerandJung(2016). 44. In2015,globaltradeinreal andnominaltermsdeclinedwhile global 43. Lamy(2017). actionscould support scaling 42. For a discussionofhow international of theWTO. global reach ofthemultilateralrounds oftradenegotiationsunder theaegis 2008/9 hasbeguntoshaketheconfidenceintradi 2015 undertheDohaRoundnegotiations,whilebi-and Global Trade andtheWorld Trade Organization (Figure 4); complete, andthatthecurrent one–the“DohaRound” countries bytheeconomictransformationbrought about, eral traderegimes managedundertheaegisofWorld economic growth andprosperity and that multilateral a fundamental tenet of modern tradeeconomics.And, a fundamentaltenetofmodern approaches toestablishingliberaltraderegimes has been another tonotethat“theincreasing importanceofnew agreements were reached inBali in 2013 andNairobi in sive rounds oftradeliberalizationandtheirshare inglobal tional approach totrade,as globalrecovery wasslowand tiation “rounds” showsthat theytooklongerandto trial countries; as trade growth out to be anemic turned trade grew rapidly, andisexpectedtocontinuegrowing. the successfulmultilateraldevelopmentofopenmultilat to particularSDGs. trade patterns”. trade obstaclescouldleadtoafragmentationofglobal to lamentthe“fragmentationofglobaleconomy”and favored approach ofmanycountries,causingoneobserver pathways fortheachievementofSDGs,seeLinn(2015). multilateral globaltraderegime hadbegun toslowdown ments espousingprotectionist policies. market economiesbenefitedespeciallyfrom theprogres GDP rose, a highlyunusual combination in the history of world trade (Kohli plurilateral never be completed. nomic growth, evenmore rapidglobaltradegrowth, and 2017). However, theexperienceafterGreat Recessionof (WTO) incomplete 16yearsafteritstarted,andindeedmaywell in part,byglobalizationjoinednationalist,populistmove indeed, thepost-WWIIexperienceofrapidglobaleco in support of well-articulated scaling up pathways linked before theGreat Recession.Areview ofglobaltradenego has beenthelongestlastingandmost difficult, isstill long-term growth prospects dimmed,especiallyforindus There are indicationsthatthedrivetowards aliberal, The ideathatglobaltradeistheengineof 46 44 free tradeagreements (FTAs) havebecomethe andasthoseleftbehindinmanyindustrial 47 Moreover, there hasbeenanincreasing 42 45 Instead, very partial and limited 43 ------
CURRENT AND FUTURE THREATS TO MULTILATERALISM: CAUSES AND POSSIBLE REMEDIES 11 - - - geopolitical . The economic rise of Asia in recent decades – first decades in recent of Asia economic rise . The As regards the factors that have undermined the multi the factors As regards lateral approach to trade liberalization and more recently a recently more and liberalization trade to approach lateral hardened and the leverage of the industrial countries weak hardened in global GDP. This shift in bargaining power is reflected, shift in bargaining power is reflected, This in global GDP. the Doha Round, as southernalia, in the stalling of inter ically and very explicitly against a multilateral approach approach ically and very explicitly against a multilateral an open, towards the overall progress it did not threaten Round bogged down, and under the Obama presidency presidency Round bogged down, and under the Obama partners felt they had been unfairly treated in earlier rounds, rounds, in earlier treated unfairly been had they felt partners rules-based trading system. This began to change as the factors between northern and southernfronts partners trading the Trans-Pacific Partnership (TPP) and a Transatlantic Transatlantic Partnership (TPP) and a the Trans-Pacific with principal the US and at eliminating US trade deficits trading partners. consider first the protectionism, towards trend and successfully resisted pressures by industrial countries pressures and successfully resisted and Europe. In the past this has given rise to temporary temporary to rise given has this past the In Europe. and ened along with the rising of emerging market economies championed the development of “Mega FTAs,” including including FTAs,” “Mega of development the championed economies of the established powers in North America to limit import competition in the US and EU, but efforts (see Box 1), against Mega FTAs, and in favor of bilateral and in favor of bilateral (see Box 1), against Mega FTAs, deals that will aim at obtaining favorable conditions for conditions for deals that will aim at obtaining favorable to the of threats led to the perception China – repeatedly Japan, then South Korea, and most recently, and forcefully, and forcefully, and most recently, Japan, then South Korea, Trade and Investment Partnership (TTIP). Under the current current the (TTIP). Under Partnership Investment and Trade Administration, the US position has turned dramat Trump
- 51 48
With 164 50 49 Global Trade Trends, 1960-2014 Trends, Global Trade Hufbauer and Jung 2016. 52 While the US had been a key driver of the multilateral https://www.wto.org/english/thewto_e/whatis_e/tif_e/fact2_e.htm The main international organization managing the The main international organization managing the Figure 4: Figure 50. The IMF, World Bank, and UN also have important roles in supporting Bank, and UN also have important roles World 50. The IMF, 51. 52. McBride 2016. in adjudicating trade disputes, with the US its most active in 1995 as the successor the General Agreement on Tar on General Agreement the successor the as in 1995 WWII. after established (GATT) Trade and iffs incidence of “micro” protectionist measures (esp. local (esp. local measures protectionist incidence of “micro” Like its predecessor, the GATT, the WTO manages the the WTO manages the the GATT, Like its predecessor, user. negotiations process under the trade “rounds,” monitors monitors under the trade “rounds,” negotiations process non-discrimination among members, free and open trade, among members, free non-discrimination manages a dispute settlement mechanism (DSM) under manages a dispute settlement mechanism (DSM) under multilateral trade relations process is the WTO, founded WTO, founded is the process multilateral trade relations near universal global member countries it is approaching restrictive measures in recent years. in recent measures restrictive trade development process since WWII, it joined the trend since WWII, it joined the trend trade development process as the Doha bi- and plurilateral trade agreements towards trends in trade and trade restrictions, and most importantly importantly most and restrictions, trade and trade in trends transparency and predictability, fair competition, support ofsupport fair competition, predictability, and transparency which member countries can seek redress from binding binding from which member countries can seek redress Source: arbitration of their grievances against unfair trade actions ofarbitration of their grievances other members. The DSM has generally been successful coverage. It operates on the basis of five core principles: core coverage. It operates on the basis of five content requirements), a trend that intensified after 2008. that intensified after a trend content requirements), development and economic reform in member countries. development and economic reform global trade relations. 48. Hufbauer and Jung (2016). 49. WTO 2016. The WTO also recorded an increase in the stock of trade an increase The WTO also recorded JOHANNES F. LINN, DISTINGUISHED RESIDENT FELLOW, EMERGING MARKETS FORUM 12 Source: down thatG20communiquétoadegree that thegroup qué oftheHamburgG20summit.Lookingahead,itdoes established multilateraltradingsystem. competition willlikelyrepresent acontinuingthreat tothe eral traderestrictions asabargainingtoolingeopolitical of business representatives B20 considered disappoint vis-à-vis theUSare notacceptable.IntheG20, theUS sures ontheblue-collarworkershave beenassociated, trade relashaping countries’approaches tointernational system, geopoliticalcompetitionandtheuseofbilat South Korea, andEurope (esp.Germany),onthegrounds tions. Asnoted,thedeclineof traditionalmanufacturing trade andmultilateralarrangementsinthecommuni their March 2017meetingurgedthe US nottopursue that persistentbilateraltrade-surplusesofthesecountries to giveupontheirdemandsforagriculturaltradeliberal forestall repetition ofstatementsinsupportopenglobal professed theirsupportforanopen multilateral trading protectionist policiesandas theUSpursueditefforts to main front initsefforts todealwitharisingChina,although not bodewellthattheUSdidinfactsucceedwatering industries intheindustrialcountries andtheresulting pres including intherecent BRICSsummitcommuniqué,have ing andalarming. it has also taken on – surprisingly – Canada and Mexico, ization bytheindustrialcountriesduringnegotiations. B20_G20_Leaders__Declaration_Evaluation.pdf has founditselfisolated,asG20financeministersduring 53. Box 1:AnewUStradestrategyagainstmultilateralism abandon itinfavorofabilateralapproach: very explicitinitscritiqueofmultilateralismandintentionto For thecurrent USadministration tradehasbecomea National The UStradestrategydocumentissuedinMarch 2017is https://www.b20germany.org/fileadmin/user_upload/documents/B20/ https://ustr.gov/sites/default/files/files/reports/2017/AnnualReport/AnnualReport2017.pdf • • “The overarching purpose of our trade policy – the vantage inglobalmarkets.”(p.7) instances, Americanshavebeenputatanunfairdisad and businesses.Instead,wefindthatintoomany better treatment for U.S. workers, farmers, ranchers, anisms. Thehopewasthatsuchasystemcouldobtain as deference disputesettlementmech tointernational incremental changeinforeign tradepractices,aswell multilateral and other agreements designed to promote has beencommittedtotradepoliciesthatemphasized “For more than20years,theUnitedStatesgovernment area –willbetoexpandtradeinawaythatisfreer guiding principlebehindallofouractionsinthiskey political factors 53 Andevenasemergingmarketleaders, ofcourseplayacriticalrole in ------emerging marketeconomies,especiallyfrom China,and veto a decision,have made it increasingly difficult to reach current leadershiptomultilateral tradearrangements,the campaign it was not only Republican candidate Trump of attentionbytraditionalpoliticalpartiesandtechnocrats agreement intheglobaltradenegotiations.Moreover, the as the WTO has not been immune to criticism. always heldmore swayinthedevelopingcountries,even against multilateralismintradeandtowards more asser abandonment andtheattractionofvotersintheseregions alist, populistmovementsinEurope andtheUS.Thelack Sanders, showinghowpervasivetheaversiontofree with theconsensusprincipleunder whichanycountrycan weakened commitmentbytheG20,etc.)showthat who argued against new Mega-FTAs and for more pro tive pursuit of national trade advantages, which in any case tive pursuitofnationaltradeadvantages,whichinanycase trends summarizedabove(risingprotectionist measures, trade message has become in the US. While the US is tection, butalsotheDemocraticcontendersClintonand to politicianspromising protections ofvariouskinds,includ to theplightofdeclining“rustbelts”addedsense political moodinmanyadvancedcountrieshasswung perhaps anextreme case,bothintermsofthe widespread nature oftheanti-tradesentimentandaversionits in thepopularmind,withrisecheapimportsfrom increasing numberofparticipantsintheWTO,combined in thepast. ing aggressive tradeprotection. Inthe2016presidential been one of the factors contributing to the rise of nation 54. McBride2016. Institutional factors markets.” (p.1) workers, farmers,ranchers,andbusinessesinglobal to unfairtradepracticesthatdisadvantageAmerican for putative a blind eye geopolitical advantage, turn we reject thenotionthatUnitedStatesshould, agreements whenourgoalsare notbeingmet.Finally, negotiations –andbyrenegotiating andrevising trade ing onbilateralnegotiationsratherthanmultilateral that thesegoalscanbebestaccomplishedbyfocus vices industry exports. As ageneral matter, webelieve defend ourselves, and expand our agricultural and ser strengthen our manufacturing base and our ability to States, promote reciprocity withourtradingpartners, economic growth, promote job creation intheUnited with respect totradewillbedesignedincrease our and fairer forallAmericans.Everyactionwetake also playarole inthetradearea, 54 The ------CURRENT AND FUTURE THREATS TO MULTILATERALISM: CAUSES AND POSSIBLE REMEDIES 13
------60 for for century century st challenges and opportunities challenges barriers between the many countries that are to to barriers between the many countries that are all Similarly, investments. these by connected be it is the collective responsibility of emerging and of emerging and it is the collective responsibility And he ing a new fragmentation of global trade.” rather than harmonizing ing domestic regulations, trade to reduce matched by efforts if they are a majority for chains supply global of world a in in the debates about trade and technological prog in the debates about Preserving the DSM as a trusted mechanism to to mechanism a trusted as DSM the Preserving negative impacts on the broader trading system. trading system. negative impacts on the broader recently noted that “the decisive 21 decisive “the that noted recently ress than in the past, is the need for recognition of for recognition than in the past, is the need ress pursue trade grievances will be critical. riers that will disrupt established trading relations. ments it will support in realizing its ambitious its ambitious ments it will support in realizing the impact on those population groups negatively negatively groups population those impact on the least damaging in WTO-conform and are they are lasting and allocation resource efficient of terms tries the returns to these investments will depend to organize and monitor the regulatory process.” to organize and monitor the regulatory that investment initiatives will need to realize ture will be critical to explore all options of assuring that will be critical to explore States, now exploring major transport infrastruc substantially on reducing the barriers impeding the barriers impeding substantially on reducing affected and for inclusive policy measures of miti and for inclusive policy measures affected advanced economies to prevent it from generat it from advanced economies to prevent Withremov on bent Administration US current the in this for progress the chances borders, across in the short term appear scant. area gating these effects on the peoples lives. on the peoples gating these effects WTO, the of head former the Lamy, Pascal ority. of goods produced and consumed in their coun their in consumed and produced goods of new bar creating trade, or at least not cross-border challenge will be that of regulatory convergence; convergence; of regulatory challenge will be that the competences called for the WTO to “be given vision of the Belt-Road Initiative will only bear fruit governments, the United including and especially China needs to recognize that the large invest China needs to recognize A key aspect, which is now getting more attention is now getting more A key aspect, which convergence” is a high pri A focus on “regulatory To the extent protective measures are pursued, it it pursued, are measures protective extent the To • • • • What then are the are What then 60. Lamy 2017, p. 112. Here are some ideas, limited as they may be: some ideas, limited as they may are Here those who believe an open, multilateral trading system is trading system believe an open, multilateral those who the continuing complexity of global trade relations, and and global trade relations, complexity of the continuing look bleak. regime multilateral trade for the the prospects essential for long-term global prosperity and development? global prosperity essential for long-term ------
56
58
57 of trends affecting multilater affecting of trends dynamics Add to this the likely continuing chal continuing likely the this to Add 59
55 lobalization and the international rules-based barriers presents the veneer of ‘open borders.’” barriers presents imize the underlying mistrust of globalization and and globalization of mistrust underlying the imize is clearly not the answer, but policy makers min is clearly not the answer, multilateralism at their peril.” provisions and the like, the increasingly fragmented and the like, the increasingly provisions forum for global trade talks faces growing doubts forum for global trade talks faces growing tionism and a retreat from international from cooperation tionism and a retreat tent requirements, ‘buy national’ public purchasing ‘buy national’ public purchasing tent requirements, world economy may represent a bastardized form a bastardized world economy may represent Given the resort to financial incentives, local con local incentives, financial to resort the Given agreements to advance their interests.” agreements as countries increasingly turn to regional free trade turn free to regional as countries increasingly allocation, while the paucity of traditional trade trade allocation, while the paucity of traditional order that underpins it are under siege… Protec that underpins it are order of globalization riddled with massive resource mis of globalization riddled with massive resource “The World Trade Organization’s relevance as a as a relevance Organization’s Trade “The World “G “ • • • How about the So, even if the Trump Administration’s rejection of a of a rejection Administration’s So, even if the Trump long-term nature. long-term WTO in terms of its governance,lenges for the and also links have become increasingly complex involving global involving global complex become increasingly links have 56. Agarwal and Evenett 2013. 57. Adeyemo 2017. 58. McBride 2016. 59. See Dione et al. 2017. 55. And it should be noted that the widespread popular resentment in popular resentment 55. And it should be noted that the widespread ity, including the institutional factors previously highlighted, factors previously including the institutional ity, important element of global trade, negotiations under the important element of Bank, and some UN agencies (esp. its regional bodies) bodies) agencies (esp. its regional Bank, and some UN no lasting damage to the fabric of the multilateral trade no lasting damage to the fabric of the multilateral trade multilateral approach is of a short-term nature and does and does is of a short-term nature multilateral approach relatively easy steps in reducing trade obstacles have have trade obstacles in reducing easy steps relatively trade As reduction). (esp. tariff by now been taken mostly many part of Europe against the EU bureaucracy in Brussels, may well against the EU bureaucracy many part of Europe threats to multilateralism in trade would appear to be of a threats the trade area. that a long-term phenomenon is at work: topics, including the harmonization of regulatory frame harmonization of regulatory topics, including the works across countries. Moreover, since the IMF, World World since the IMF, Moreover, countries. works across supporting open, rules-based international trade. also be a factor undermining the trust in the global multilateral institutions system – two big ifs –, the geopolitical and national political political national and geopolitical the –, ifs big two – system alism in the trade area? Expert commentary on the trends, Expert commentary on the trends, alism in the trade area? also have important supportive functions in the trade supportive functions in the trade also have important and capac their credibility the factors weakening arena, in role for their supportive potential threats also represent WTO umbrella had to turn to more difficult and complex and complex had to turn difficult WTO umbrella to more even before the election of Mr. Trump in the US, suggest Trump the election of Mr. even before value chains, and as trade in services had grown as a more as a more had grown and as trade in services value chains, JOHANNES F. LINN, DISTINGUISHED RESIDENT FELLOW, EMERGING MARKETS FORUM 14 The ParisClimateAgreement andtheGreen grounds thatDeutscheBankalsosupportedcarbon-intensiveinvestments. developing countries.TheGCFhaditsfirstfundraising firmed the ambitious climate financing target for OECD dinate, andimplementaneffective fightagainstclimate fighting themaclearcaseof“globalpublicgood.”This Climate Fund(GCF) (“Intended Nationally Determined Contributions” or INDCs), of accreditations). entities, whichcanbemultilateralagencies,governments, operating modalityistoserveasapass-through mech of $10.3billionoveranundeterminedperiod.Itsprincipal of acommitmentbyindustrialcountriestomobilize$100 change negotiationsreferred totheagreement as“amajor climate summitin2010.Oneveteranobserverof country support to developing countries at the Cancun of its link to human action, in particular CO2 emissions, change are essential. Over thelasttwotothree decades on theglobeare a“globalpublicbad”parexcellence,and and private firms (Deutsche Bank was in the first batch anism forclimateinvestmentssupportedbyaccredited average globaltemperatures, registered voluntarycommit agreement inPariswastheculmination ofthisprocess, action was essential. The December 2015 climate able political consensus around the globe that coordinated set upamonitoringandpeerreview system,andcon set ambitiousindicativetargetsforcontrolling therisein supported asitwasby197states(includingtheEU).It strengthened andcreated themomentumforaremark was setupatthe2010Cancunclimatesummitaspart the scientific basis of recognition of climate change and meeting in2013,atwhich43countriespledgedatotal response hasbeentheGreen ClimateFund(GCF),which ments byindividualcountriestolimittheirCO2emissions means that multilateral approaches that motivate, coor 62. Thiscausedsomenegativereactions bycivilsocietyobservers onthe 61. Falkner2016. billion insupportofclimatemitigationandadaptation breakthrough climate diplomacy.” ininternational https://us.boell.org/2015/07/09/green-climate-fund-accreditation-deut Climate changeanditsprojected disastrous impacts One ofthepillarsevolvingclimatechange • The global multilateral institutions – the IMF, World (esp. theMDBs,oldandnew;aswellregional WTO inmakingthecaseforandimplemen tation ofeffective multilateraltradeapproaches. to workcloselywiththeWTOandinsupportof Bank, andUN–,theirregional counterparts bodies, suchastheEuropean Commission)need 62 BynowtheGFCisupandrunning, 61 ------Together withpublicandprivateco-financing(domestic countries in support of developing countries (Oxfam International 2016; countries in support of developing countries (Oxfam International GFC isnottheonlymultilateralorganizationsupporting does on voluntary statements of country “intentions” rather does onvoluntarystatementsofcountry“intentions”rather 2015 despitetherisinggeopoliticaltensionsnotedearlier, climate changeanditsimpacts, on averageabout$25billionayearfrom 2011to2016. estimate bytheIMF, publicfundingtowards totalexternal or adaptationintheirproject finance. climate change,as most othermajormultilateral organiza a significantshare ofthetotal. thetotalamountinvestedandcatalyzed and international), agenda. Thegoodnewshere isthatinmanycountries and developing countries that had plagued earlier climate and indeedtheagreement’s particulardesign,relying asit appear to represent a relatively limited risk to the multi approaches andinstitutions intheirsupportformitigating approaches. sche-bank-sparks-concern-about-integrity-and ments/10180/4f102df6-2751-4a16-9443-bd132e1c519f and theIFAD “ClimateChange Strategy”( with 54accredited entities,43approved projects, and tial roles insupportinganalyticalworkonclimatechange to some$60billionin2016. the $100 million climate finance target amounted to $61.8 to focusonandmainstream supportformitigationand/ tions have developed climate action programs, designed the longer-term future of the multilateral climate change than compulsorycountrytargets,wasakeyfeature that for furthermultilateralprogress onclimatechange. report-on-mdbs-climate-finance.pdf policies andsupportingappropriate policyreform, includ made itpossibletoovercome thedividebetween industrial $10.3 milliondisbursedbySeptember2017. negotiation efforts. 2016” (AfDB,AsDB,EBRD,EIB,IADBG, WBG)( 2020” ( East-West relations could seriously damage also any hope to assess how much was committed in total foreign financing from OECD ing developmentand implementationofcarbon pricing financialinstitutionsalsohavetakenonessen international 69. Falkner2016. 68. Pfeiffer 2017. andHepburn MonetaryFund2016. 67. International 66. Climatefinancedataare notoriouslyunreliable, andhenceitisdifficult 65. “JointReportonMultilateralDevelopmentBanks’ClimateFinance 64. SeeforexampletheWorld BankGroup “ClimateActionPlan2016- 63. by thesesixbankswasevenmore substantial,addingup billion in2014.Andajointreport bythesixlargestmulti Kharas 2017b). lateral effort. TheParisagreement wasachievedinlate lateral developmentbanksreported thattheycommitted The national Turning thentoassessthethreats facedbymultilateral http://www.greenclimate.fund/home https://openknowledge.worldbank.org/handle/10986/24451 68 political factors 69 Ofcourse,adramaticworseningof ) 66 TheMDBsthuscontributed 67
Beyondthefinancing role, geopolitical factors willlikelybecriticalfor
www.ebrd.com/2016-joint- https://www.ifad.org/docu 64 According toan ) 63 Butthe would 65 ) ------
CURRENT AND FUTURE THREATS TO MULTILATERALISM: CAUSES AND POSSIBLE REMEDIES 15
------75 ) of the of In the US 57 the US 57 In https://www.thegef. 77 dynamics Why was it then Why was it then http://www.climatechan 76
); Climate Home 2017 ( ) One troublesome aspect of the creation of the GCF of the GCF of the creation aspect One troublesome Considering then the question of the of the question then Considering https://www.thegef.org/about-us lived and with lasting negative impact. The institutional lived and with lasting negative impact. The institutional investments in the low-carbon economy and building greater resilience. resilience. investments in the low-carbon economy and building greater has not apparently been given much attention, however however attention, much given been apparently not has We invest in energy efficiency, renewable energy, sustainable transport energy, renewable efficiency, invest in energy We in mandate and function with existing ones, the answer is in mandate and function with existing ones, impacts of climate change will continue to drive the grow policy action, along with ing political support for effective in the multilateral finance architecture. In 1992 the Global Global the 1992 In architecture. finance multilateral the in significant a into grown GEF has the then, Since issues. and the private institutions, civil society organizations take creative thinking and innovative financing. Based on our quarter cen thinking and innovative financing. Based on our take creative tury of experience and wide network of partners, the GEF is well-placed to support the transformation. The GEF is an operating entity of the finan Moreover, the GEF has developed a significant engage the GEF has developed a significant Moreover, Nations Environmental Program (UNEP) were adequately adequately (UNEP) were Program Nations Environmental Environmental Facility (GEF) was established as a pass- Facility (GEF) was Environmental Change (UNFCCC). a catalyst for large-scale are As such, our resources most likely that national political arguments overrode argu overrode most likely that national political arguments and effectiveness. ments of multilateral efficiency with the decision to of surveyed voters disagreed percent that give one some munity levels and by business interests rather than ensuring that the existing MDBs and the United United the and MDBs existing the that ensuring than rather ment in the climate change agenda. 2017-und-darueber-hinaus/ funded and effectively addressing global environmental environmental global addressing funded and effectively its to According action. environmental for vehicle funding trends, it is likely that the growing evidence of negative negative of evidence growing the that likely it is trends, factors that will facilitate technological and commercial economy. the transition to a low-carbon through funding mechanism for environmental programs of programs funding mechanism for environmental through institution had to be created, tions why a new multilateral the GEF is in 170 countries. Today, than 4,000 projects withdraw from the Paris agreement (and only 25 percent (and only 25 percent the Paris agreement withdraw from website, the GEF “has provided over $17 billion in grants website, the GEF “has provided and climate-smart agriculture to support mitigation.” ( and climate-smart agriculture situations where new institutions are created overlapping created are institutions new where situations sector that addresses global environmental issues.” global environmental sector that addresses appropriate and necessary to create a new institution, in institution, in a new create to necessary and appropriate at state, local, and com reactions are and there agreed), and mobilized an additional $88 billion in financing for more for more and mobilized an additional $88 billion in financing an international partnership of 183 countries, international essence duplicating the existing institutional structure and structure the existing institutional essence duplicating the case in capacity of the GEF? As has so often been US policy may not be long- confidence that the current global significance. At the time, there were already ques already were At the time, there global significance. cial mechanism for the United Framework Convention on Climate Nations org/topics/climate-change genews.com/2017/06/30/cash-begins-trickling-green-climate-fund/ 75. will economy low-carbon a to shift “The states: also website GEF The 76. and Hepburn 2017. 77. Pfeiffer – the fact that it continues a long trend of fragmentation of fragmentation long trend that it continues a – the fact ------and 71 Moreover, Moreover, 73
, so far 160 of the , so far 160 of the http://www.deutscheklima And, as noted earlier, there has been there And, as noted earlier, institutional factors 72
74 The recognition that controlling CO2 emissions CO2 emissions that controlling The recognition 70 Turning then to Turning http://unfccc.int/paris_agreement/items/9485.php large-scale projects and insufficient funding of smaller, of smaller, funding insufficient and projects large-scale lower costs, and as business interests realize that fighting realize business interests lower costs, and as finanzierung.de/blog/2017/03/green-climate-fund-herausforderungen-fuer- become effective in November 2020, and the US pledge become effective in June of the US withdrawal from the Paris agreement, to the Paris agreement, in June of the US withdrawal from nities. ments lack sufficient scope to stop climate change, and scope to stop climate change, and ments lack sufficient direct too little transparency, a lack of and procedures ment of withdrawal. ment is proceeding. In fact, the US remains engaged in this in engaged remains US the fact, In proceeding. is ment 2020, despite the US announce at least through process ment was met with pledges by the Europeans, China, India, ment was met with pledges by the Europeans, more real, as technological advances offer new options at new offer as technological advances real, more that in any case with the lack of enforcement there is no no is there enforcement of lack the with case any in that the GCF has been criticized for a slow start, cumbersome the operational and financing activities of the multilateral the operational and financing activities of the multilateral the process of monitoring progress with the Paris agree with the Paris progress of monitoring the process the Hamburg summit in 2017, to continue pressing ahead pressing the Hamburg summit in 2017, to continue to stop supporting the GCF sent shock waves through waves through to stop supporting the GCF sent shock Although the US announce the international community. tries, including the emerging markets economies. The maintries, including the emerging with the Paris agreement, the absence of US leadership the absence of US leadership with the Paris agreement, structure. significant threat to progress on the global climate agenda. to progress significant threat access by development country governments, too many agencies. However, criticisms have also been leveled by by leveled been also have criticisms However, agencies. and others, including the non-US members of the G20 at and others, including the non-US members the for also possibly but GFC, the for (directly funding and and preparing for the impacts of climate change are in all of climate change are for the impacts and preparing announcement The Administration. Trump the of advent as the potential damage from climate change is getting is getting climate change damage from as the potential against climate change is strong, not only in industrial in industrial not only change is strong, against climate community-based initiatives, and a politicized governance of the Paris agreement, that the governmentalof the Paris agreement, commit guarantee that pledges will be implemented. great progress in mainstreaming the climate agenda into the climate agenda into in mainstreaming progress great as the limitations climate advocates at what they regard climate efforts of other multilateral agencies), represents a a agencies), represents multilateral of other climate efforts countries’ self-interest, has now taken hold in many coun has now countries’ self-interest, the since US the is force political countervailing and outlier countries, but increasingly also in developing countries, in developing countries, also but increasingly countries, opportu commercial significant climate change offers domestic political support for engaging in a global fight fight engaging in a global political support for domestic ger Global Relations Require Business Leadership,” September 20, 2017. ger Global Relations Require 70. See the op-ed by Michael R. Bloomberg in the Financial Times, “Stron 71. 72. Meyer 2017. 73. Munsch 2017. 74. E.g., Deutsche Klima Finanzierung 2017 ( 197 parties have ratified the Paris climate agreement 197 parties have ratified the Paris climate JOHANNES F. LINN, DISTINGUISHED RESIDENT FELLOW, EMERGING MARKETS FORUM 16 79. EvaluationofHamburgSummitby theB20,2017 78. SeeBhattacharyaetal. As anannualmeetingofkeygloballeadersfrom Northand The G20Summit G20 summitforum,andbythosewhowouldrathersee 2008 byUSPresident George W. Bushinresponse tothe global governance system. global governance coordination, andcooperationefforts, althoughthisisnot gral feature of the global multilateral architecture. Indeed, global financial crisis, which had started earlier that year. culture. emitting countries, by progress with carbon pricing and the greatest community challengewillbefortheinternational climate changeinterventions may suffer iftheexistingmul challenges, however, maypersist,andindeedthemulti and supportforeffective climatechangeinterventions, adaptation indevelopingcountries.Themultilateralinsti agreement andfrom theGCF. Theinitialresponse ofthe since it has climate change squarely on its agenda and substantially weakened. South, East and West, it has since then become an inte many.org/fileadmin/user_upload/documents/B20/B20_G20_Leaders__Dec the UN and its governing bodiesserve astheapexof the UNanditsgoverning the HamburgG20summitinJuly2017didnotmakesig the area of climate smartinfrastructure, energy andagri tutions, withtheencouragementandsupportfrom their to respond effectively totheUSwithdrawalfrom theParis tilateral institutions(esp.theMDBs,GEF, andUNEP)are for energyuse,andbyeffective mobilizationoftheprom representatives accompanying the G20 summit process, membership, needtocontinuetheiractiveengagement reduction andultimateeliminationofpervasivesubsidies necessarily theacceptedviewofthoseexcludedfrom the nificant progress onthecarbonpricingfront. nately, asnoted criticallybytheB20,agroup ofbusiness noted above. But this has to be followed up with effective for a strong case for appropriate policies and investments in climate smart it canbeseenastheapexofallmultilateralconsultation, includes initsranksthemostimportantemitters.Unfortu including policy reforms, financing of investments, esp. in ised financial resources tosupportclimatemitigation and implementation ofthestatedintentionsbymaincarbon communitywasencouraginginthisregard,international as laration_Evaluation.pdf loads/2016/12/global_122316_delivering-on-sustainable-infrastructure.pdf infrastructure. lateral institutionalsupportstructure thatimplementsthe The G20SummitwasfirstcalledtogetherinNovember Finally, amongthe 78 AndtheG20playsaparticularlyimportantrole,
challenges andopportunities https://www.brookings.edu/wp-content/up https://www.b20ger 79
, the ------
14 “agreed documents”onvariousactionplans(including zhu Summitof2016 G20 summitinHamburgcovered 14pages,notincluding financial regulation, theG20Summithasoveryears fiscal stimulus effort and initiatives to strengthen global domestic politicalstalemateinmanycountries(including crucial totheG20.Creation oftheG20 summit(largely youth (Y20),andthinktanks(T20). of stakeholders,includingbusiness(B20),labor(L20), one on“counteringmarinelitter”),statementsofprinci of Toronto noted 213 specific commitments in the Hang cess, especially around the topics of trade and climate ers toengageconstructivelyattheG20summits,while ent G20membercountries. officials atseniorlevels,including keyministers.Itisthis consultations year-round government amongconcerned growth, developmentand the environment. However, itis Ukraine,thecontinuingcrisesinMiddleEast, ern an opportunity for leaders in face-to-face meetings to deal accompanied byaplethoraofparallelefforts designedto and initiatives(includingoneon“#eSkills4Girls”).Anditis an effective crisisresponse, whichincludedaconcerted superseding theG8/G7summit)wastimely. Itprovided stakeholder forums, the G20 process involves intensive subsequently growing geopoliticaltensions,followingthe nal/2016-g20-final-compliance.pdf worth noting that the G20 Summit involves much more taken on a bewildering range of topics: In its 2017 com the G20Summitagendaandoutcomes.Inrecent years, than themeetingofleaders.Besidesabove-mentioned these tensionsalsolimittheeffectiveness of theG20in threat ofNorthKorea, andtherisingwaveofrefugees. But focusing onsubstantive issues ofglobal finance, economic reach out toandbringintheperspectivesofabroad range ple (includingoneon“counteringcorruptionincustoms”) pliance report, theG20Research Group oftheUniversity more recently theelectionofPresident Trump intheUS part oftheprocess which is perhapsmostsuitedtohelp not only with the financial crisis of 2008/9, but also with the Europe, theUS,andJapan)haslimitedabilityoflead Russian annexationofCrimeaandengagementinEast (2017). for thisobservation. bridge growing gapsingeo-politicalperspectivesofdiffer has ledtosignificanttensionsinthe2017summitpro 82. TheauthorisgratefultoAmarBhattacharya, SeniorFellowBrookings, 81. For more information on the origins and role of the G20 seeAhluwalia 80. There canbelittlequestionthat From itsinitial,overallsuccessfulfocusoncoordinating Domestic politicaltrends http://www.g20.utoronto.ca/compliance/2016hangzhou-fi 80 andtheCommuniquéof2017
82
have amajorimpacton 81 geopolitical trends
are ------CURRENT AND FUTURE THREATS TO MULTILATERALISM: CAUSES AND POSSIBLE REMEDIES 17 ------86 there is littleis there 87
of these trends, one must one must of these trends, challenges and opportunities dynamics Looking forward, among Looking forward, Considering the bitions”, designed to find a joint framework among MDBs to better quantify leaders seriously explore how best to address global pres how best to address leaders seriously explore implementation report by the G20 Leaders’ Summit in 2018 and annual and in 2018 Summit Leaders’ G20 the by report implementation https://www.b20germany.org/fileadmin/user_upload/documents/B20/B20_ 87. Camdessus and Singh 2017; Boorman 2017. 86. The business group B20 commented as follows: “Regarding infra B20 commented as follows: “Regarding 86. The business group hope at present that any significant changes will happen changes will happen that any significant hope at present jointly focus on infrastructure investment and connectivity, connectivity, and investment on infrastructure jointly focus isolated position, such as on trade and climate change. To isolated position, such as on trade and climate change. To ings for the foreseeable future, with potentially profound potentially profound with future, ings for the foreseeable in the near future. which forum at rather than a formality, an ineffective into their ability to facilitate private investments in infrastructure and connectivity. and connectivity. their ability to facilitate private investments in infrastructure to create new ones that mostly add to the already overwhelming fragmen new ones that mostly add to the already to create tation of the global institutional system.” Specifically, we welcome the adoption of the “Hamburg Principles and Am Specifically, would also mean no more need for new institutions, such as the BRICS need for new institutions, would also mean no more (MDBs) to act as catalysts to crowd-in private investment in infrastructure. infrastructure. private investment in (MDBs) to act as catalysts to crowd-in means that individual leaders have to take charge of of charge take to have leaders individual that means results they seek. priorities and achieves the their reflects mean that the important global issues are not effectively not effectively global issues are mean that the important G20_Leaders__Declaration_Evaluation.pdf mendations on enhancing the role of Multilateral Development Banks of Multilateral Development mendations on enhancing the role on crowding-in.” reporting for high-level engagement, such as other summit forums, the agenda and drive the preparation process, so that it it that so process, preparation the drive and agenda the in serious to engage in the context of the G20 Summits the extent leaders feel that the G20 forum is not meeting seek other opportunities their needs, they will increasingly the composition and governancecomposition the G20, of the and finance; trade; the global development architecture with a special focus on engaging with the private sector, sector, with the private focus on engaging with a special agendas, which ultimately may diffuse with increasingly structure, the G20 Declaration corresponds to the relevant B20 recom B20 relevant to the corresponds Declaration G20 the structure, and South Africa. It would be far better to fix the existing institutions than nancing structures that make them serve as effective pillars as effective make them serve that ernancestructures and financing development bank currently being created by Brazil, Russia, India, China being created development bank currently such as the G7, the BRICS, or the Shanghai Cooperation sures and problems (including global financial stability and (including global financial stability and problems and sures and to choose right. In this connection, the directions and the directions and to choose right. In this connection, uncertain, of the new US Administration remain approach will want Trump to which President as does the degree and to report on progress in the 2018 Summit. in the 2018 on progress and to report meet difficult of period a face will G20 the that assume change by experts to And despite proposals addressed. a key challenge for the G20 is to avoid turning the Summit exchanges with other leaders on topics where he is in an where exchanges with other leaders on topics climate change; threats of epidemics; conflict; etc.). This conflict; etc.). This epidemics; of change; threats climate differences in the agendas of the principal players and of the principal players and in the agendas differences over the next three years. We also welcome the call for an integrated MDBs years. We over the next three of MDBs in recent decades and endeavor to create new mandates, gov decades and endeavor to create of MDBs in recent this If done correctly, of the global institutional system in the 21st century. At the same summit, the G20 also tasked the MDBs to to also tasked the MDBs summit, the G20 At the same This entails for example a target of a 25-35 percent increase in mobilization increase This entails for example a target of a 25-35 percent This puts a considerable burden on the leaders to choose This puts a considerable burden
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Those left out tend to to Those left out tend 83 and until recently did not not did recently until and 84 also matter. There are continuing continuing are There matter. also https://www.die-gdi.de/uploads/media/German_ Institutional factors Specifically, in the area of development, the G20 has of development, the G20 has in the area Specifically, ber countries. insufficient coherence.” coherence.” insufficient the G20 with of in 2013 that: “What is missing is a serious preoccupation 85. Arguably, this step comes very late. This author had advocated already this step comes very late. This author had advocated already 85. Arguably, 83. Assuming the EU is not counted as representing each and all its mem 83. Assuming the EU is not counted as representing 84. See Fues: “The involvement of the G20 in international development Development_Institute_Fues_Saltzmann_07.12.2015.pdf ing trade and climate change, as noted earlier). itoring, one cannot overcome a sense that the summits do summits the that sense a overcome cannot one itoring, in July 2017 are not representative of the attitude of the the of attitude the of representative not are 2017 July in ited representativeness and effectiveness. Even though it though Even effectiveness. and representativeness ited that issue on which it is uniquely well equipped to lead: reform of the global that issue on which it is uniquely well equipped to lead: reform and weaknesses strengths the trends, the MDBs? The G20 should review Hamburg Summit the G20 established a G20 Eminent Per Development Working Group Working Development not actually focus enough on the most serious economic, not actually focus enough on the most serious progress overall in G20 members meeting their commit their meeting members G20 in overall progress on average 80 ments made in the summits, by meeting the 19 specific commitments selected for mon of percent majority of Germans or Europeans, they do reflect a serious they do reflect majority of Germans or Europeans, resent the way the G20 presumes to function as a steering a as function to presumes G20 the way the resent percent of the world’s countries. of the world’s percent responses to global economic, social, and environmental social, and environmental to global economic, responses political trends – towards more nationalist, populist, and and populist, nationalist, more towards – trends political nancial institutional architecture. What better place than to start with than with to start than better place architecture. What institutional financial focus on these issues, specifically as they relate to the IMF, relate to the IMF, focus on these issues, specifically as they focus on the core issues of the role and governanceand of role the of issues core the on focus the World Bank, and the Regional Development Banks. the World the multilateral development institutions or on questions of questions or on institutions multilateral development the in the fragmentation and lack of coherence the increasing taken a very broad-gauged approach through its G20 G20 its through approach broad-gauged very a taken tions, in particular the IFIs. There are also questions to whatto questions also are There IFIs. the particular in tions, thirds of the global population, it leaves out almost 90 90 almost out leaves it population, global the of thirds to or move toward globalist, liberal, democratic principles democratic principles liberal, globalist, toward to or move sons Group on Global Financial Governance, sons Group which is to social, and environmental issues facing the world (includ social, and environmental agenda of the G20 creates problems. While the tracking While the tracking problems. agenda of the G20 creates While the dramatic protests during the Hamburg Summit While the dramatic protests anti-democratic positions, as against continued adherence continued adherence positions, as against anti-democratic of commitments by the G20 Research Group shows good shows good Group of commitments by the G20 Research group for the world and for the global multilateral institu for the world group publics at large. extent the G20 is well understood by the encompasses about four-fifths of global GDP and two- four-fifths encompasses about challenges. change (see above). There is no doubt that the domestic is no doubt above). There change (see development finance architecture. However, at the 2017 at the 2017 However, development finance architecture. disaffection with, or at least lack of understanding of, the disaffection diffuse the increasingly public. Finally, G20 in the broader questions about the legitimacy of the G20 due to its lim questions about the cooperation suffers from lack of clarity regarding responsibilities and from and from responsibilities lack of clarity regarding from cooperation suffers – will be critical for the ability of the G20 to forge effective ability of the G20 to forge effective – will be critical for the JOHANNES F. LINN, DISTINGUISHED RESIDENT FELLOW, EMERGING MARKETS FORUM 18 Conclusions andTheWay Forward global problems. Organization. TheHamburgSummitshowedthepotential as follows: strengths oftheG20process, butalsoitsfragilityasa Here are afewoptionsworthexploring: in thequestforeffective solutionstolargeandgrowing long-term platformforeffective interactionamongleaders The principalconclusionsfrom theaboveanalysisare If oneacceptstheseconclusions,whatcanbedone? • • • • 1. This confirms the core thesis articulated in the All concerned mustdomoreAll concerned torecognize and critiques, andcynicism.Agoodstartingpointis of alonger-term nature, whethergeopolitical,polit of USwithdrawal).Butmanythethreats appear cyclical in nature (in particular, hopefully, the threat approaches toglobalchallenges. strengths ofmultilateralinstitutions,intheface serve multilateralismandinparticulartheglobal since wecannotafford tobewrong inassuming sure thethreats are short-termorcyclical,and serious threats at atimewhenthe needforeffec Some ofthesethreats maybeshort-termand this summarybyKharas(2017a): that theyare, itiscriticaltodoallwe can topre tional leadershiprole insupporting multilateral tive multilateraldiscourseandactionarguablyis multilateral institutions. more importantthanever. promote thebenefitsofmultilateral actionandthe popular baseandtonationalleaders. Perhaps thebiggestthreat intheimmediatefuture Multilateralists needtomakeastronger case atthe Multilateralism andmultilateralinstitutionsface introduction to thispaper:Sincewecannotbe is apossiblewithdrawaloftheUSfrom its tradi ical, orinstitutional. lack ofinformation,misunderstanding,misleading “[M]ultilateral institutions are uniquely government; buildpartnerships withnon- especially ingovernment-business deal conduct acoherentpolicydialoguewith opment challenges.Theycancoordinate equipped to respond to today’s devel state actors;blendaidand loans with among multipledevelopmentactors; private capital;playanhonest broker role, ings; ensuretransparency, consultation, ------opment InnovationAlliance(IDIA),agroup oftwelvemajordevelopment funding agencies(multilateral, bilateralandfoundations). 88. Seethereports onscalingupproduced Devel bytheInternational 2. • • • • The multilateralagenciesmustworktogetheras This defenseofmultilateralismandglobalsolidar continue finding ways toimprove their focusand effective practicalsolutions,asithasattimes civil society leaders, and other key distinguished value formoneytheyrepresent. High-levelcham business,civilsociety,governments, andtheman While multilateralinstitutionsandtheirmember a group, notjustindividually, to demonstrate the agements andstaffs ofmultilateralorganizations. ships andsupportersshouldnotbeshyabout the multilateralspirit,approach, andsystem. to lead a multilateral campaign across the globe, for perfectionshouldnotbecometheenemyof personalities needtostepupinaconcertedeffort pions, atthelevelofnationalleaders,businessand performance. Thiscouldinclude: risked doing so in the past --, they also need to promoting their strengths – and while the quest not onlyonspecificissues(suchasglobalwarm Multilateral institutionsmustraisetheirgame. ing, HIV/AIDs,etc.),butontheneedtopreserve ity mustbepursuedwithastrong unitedfront by countries –asrecipients ofmultilateral assis countries –includingupper-middle income catalyzing domesticpublicandprivateengage vative approaches; thisrequires more effective at countryorsectorlevel),identificationof strengths andoptimizetheir complementarities; sharpen theirmandatestofocusoncore tance, asfinancialcontributors andassources tion ofandresponse tothefactorsdrivingor focus onlong-termgoals(suchastheSDGs focus onwaystoscaleuptheimpactofinno recognize theessentialrole ofmiddleincome ment andfinance; pursue allprudentoptionsforleveragingexist partnerships, andamore systematicrecogni pathways toimpactatscale,more effective ing financialassets,newfundingmodels,and impeding thescalingprocess; (p.1) on finance,data,andresults-evaluation.” safeguards inprojects;andprovide accountable administrative structures and theapplicationofbest-practice 88 ------CURRENT AND FUTURE THREATS TO MULTILATERALISM: CAUSES AND POSSIBLE REMEDIES 19 ------It would be tragic if today the world com 90 high-level strategic issues, including trade, cli high-level strategic issues, including trade, institutions and processes. improving the efficiency of the major individual of the major individual the efficiency improving Focus the G20 Summit exchanges on a few a few Focus the G20 Summit exchanges on Focus reform efforts of the UN system on on system UN the of efforts reform Focus protectionism increased for tendencies Resist that the voluntary pledges under the Ensure implemented fully are agreement climate Paris mate change mitigation and adaptation. the multilateral mate change, and strengthening member countries. increased where explore ment institutions to at scale for given resources. impact more the global financial resources pledged for cli resources the global financial tial engagements in support of its advanced of its advanced in support tial engagements interventions program the context of specific contributions. tions into core Systematically review the multilateral develop Systematically review agencies and on enhanced collaboration at the agencies and on enhanced donor contribu and by converting earmarked the multilateral trade agenda, by lib and revive convergence. and tackling regulatory the and, if possible, exceeded and reinforce commitment to raising and effectively delivering commitment to raising and effectively country-level through effective partnerships in in partnerships effective through country-level facilitating trade in services, eralizing agriculture, financial leverage may be used to generate to generate used be may leverage financial The World Bank Group should pursue poten Group Bank The World • • • • • • Exactly ten years ago, in October 2007, a year before a year before Exactly ten years ago, in October 2007, 90. Bradford and Linn 2007, p. 6. 90. Bradford remains to be seen...We know from history and bitter bitter and history from know seen...We be to remains realities and the new economic and demographic reflects of the 21st global challenges to new effectively responds learnto failed again, once from lessons right the munity, global crises. repeated fering. The creation of a global governancefering. The creation system which the onset of the global financial crisis that created the the that created the onset of the global financial crisis and in global governance tal changes in the global order a better future.” experience that global crises cause devastation and suf century is urgently needed to help avoid crises and create Great Recession of 2008-10, Bradford and Linn noted that Recession of 2008-10, Bradford Great “whether it will take a major crisis to bring about fundamen ------multilateral action: During the coming G20 During the coming G20 89 be shared with others. be shared in the IMF quotas and in the World Bank Bank in the IMF quotas and in the World Fix the governance issues of the IMF and Fix the governance and issues of the IMF windows, wherever possible. windows, wherever Stop the further fragmentation of the multilat of the further fragmentation Stop WB and agree on a substantial increase increase on a substantial WB and agree eral system and consolidate existing funding eral system and consolidate existing funding of essential development experience that can can that development experience of essential Group’s capitalization. Group’s lar champions among them – should be on how on how lar champions among them – should be leaders, and through them to the memberships memberships them to the leaders, and through back from its traditional leadership in the multilat its back from in maintaining and further strengthening the the in maintaining and further strengthening During the current phase of (possible) US with During the current memberships of multilateral institutions now in memberships of multilateral institutions now in of US to what could be a serious threat response moves were pursued during previous Republican pursued during previous moves were multilateral system. meeting the global needs of the 21st century. The of the 21st century. meeting the global needs UN). This experience can be drawn upon to argue for and support a similar joining of forces of the of the for and support a similar joining of forces the international to support the community rallied to protect and indeed strengthen the multilateral the multilateral and indeed strengthen to protect that the multilateral system is fit for purpose in system is fit for purpose in that the multilateral to multilateralism. that the multilateral to assess the challenges withdrawal. Specific priorities for governments around the the Specific priorities for governments around Summits, the focus of leaders – and of particu Summits, the focus of leaders – and of system faces and to offer proposals to the G20 G20 the to proposals to offer and system faces administrations (including the R. Reagan and the and the administrations (including the R. Reagan globe to pursue through globe to pursue through global institutions (esp. the World Bank and the Bank and the global institutions (esp. the World eral system. Similar, though perhaps less drastic, though perhaps less drastic, eral system. Similar, other countries have to play a constructive role role constructive a play to have countries other clusion and recommendations of recent reviews reviews recent of recommendations and clusion issues. of the relevant of the multilateral institutions, on how to assure assure to how on institutions, multilateral the of cial Governance presents a unique opportunity opportunity unique a Governancecial presents G.H.W. Bush presidencies). During those periods, Bush presidencies). G.H.W. development system. global development leadership drawal from Group should draw on the many specific con should draw on the Group This is not the first time that the US has pulled has pulled This is not the first time that the US The G20 must actively focus on the threats threats the focus on actively must The G20 on Global Finan Group The G20 Eminent Persons • • 5. 3. 4. Development 2016; Jenks and Kharas 2016; Kharas 2017b; and Reisen 89. Including proposals in the following contributions: Center for Global in the following contributions: 89. Including proposals and Zattler 2016. JOHANNES F. LINN, DISTINGUISHED RESIDENT FELLOW, EMERGING MARKETS FORUM 20 Allison, Graham. (2017) Destined for War: Can Amer Ahluwalia, MontekS.(2017).Thestateofglobalgover K. and Simon J. Evenett (2013). “A Frag Agarwal, Vinod Adeyemo, Wally (2017). “Protectionism is rising the world Centennial Group (2017).Unpublished data. 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COE 51,21 WARRENTON, VIRGINIA 15-16, 2017 OCTOBER EMERGING MARKETS FORUM
2017 GLOBAL MEETING The Emerging Markets Forum was created by the Centennial Group as a not-for-pro t initiative to bring together high-level government and corporate leaders from around the world to engage in dialogue on the key economic, nancial and social issues facing Current and emerging market countries. Future Threats to Multilateralism: The Forum is focused on some 70 market economies in East and South Asia, Eurasia, Latin Causes and America and Africa that share prospects of superior economic performance, already have or Possible seek to create a conducive business environment and are of near-term interest to private Remedies investors, both domestic and international. Our current list of EMCs is shown on the back cover. We expect this list to eveolve over time, as countries’ policies and prospects change. Johannes F. Linn Background Paper
Further details on the Forum and its meetings may be seen on our website at http://www.emergingmarketsforum.org
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Washington, DC 20037, USA. Tel:(1) 202 393 6663 Fax: (1) 202 393 6556 Emerging Markets Email: [email protected] Forum A nonprofit initiative of the Centennial Group