Turning up the Volume—Asia's Voice and Leadership in Global Policymaking
IMF Blog, July 11, 2010
Source details
- Canonical URL
- Turning up the Volume—Asia's Voice and Leadership in Global Policymaking
Other formats
Bibliographic details
- Authors: Naoyuki Shinohara
- Published: July 11, 2010
Conference context and thesis
- Author: Naoyuki Shinohara; Location: Daejeon, Korea.
- Event: Asia 21: Leading the Way Forward — a high-level international conference hosted by the IMF and the government of Korea.
- Central argument: Asia’s increasing economic weight, policy experience, and regional cooperation make its voice and leadership essential in global economic and financial policymaking.
Economic powerhouse: scale and near-term outlook
- Key facts:
- Asia accounts for over half the world’s population.
- Asia accounts for more than 25 percent of global gross domestic product (GDP).
- Twenty years from now, Asia’s economies will likely represent more than 40 percent of global GDP, and they will be larger than the US and EU combined.
- IMF short-term outlook (as presented):
- Asia is seen growing by about 7¾ percent this year (up about ½ a percentage point from what we envisaged in April).
- Growth led by 10½ percent growth in China.
Benefits of regionalism and institutional arrangements
- Two aspects of Asia’s regional approach highlighted:
- Intraregional economic monitoring and analysis have gained momentum, improving understanding of interlinkages and potential shocks.
- Regional financial mechanisms and external arrangements enhanced resilience during the crisis, including:
- Strengthening of the Chiang Mai Initiative last March.
- Use of swap line facility with the US Federal Reserve.
- Implication: Policy coordination and regional institution-building can contribute to a more effective global financial safety net.
International engagement and rising prominence
- Asia’s multilateral engagement and representation:
- Six G-20 members from the region: Australia, China, India, Indonesia, Japan, and Korea.
- Korea is chairing the G-20 this year, the first emerging market to do so since the crisis.
- The G-20 mutual assessment process (MAP) reflects Asia’s collaborative economic-analysis style.
- Asia’s representation on major standard-setting bodies includes the Financial Stability Board and the Basel Committee.
- Financial contributions to global safety nets:
- Several Asian countries agreed to bolster the IMF’s lending capacity via pledges to expand the IMF’s New Arrangements to Borrow.
- Japan provided $100 billion and was joined by Korea, China, India, and Singapore.
IMF governance, engagement, and policy implications
- Historical mandate referenced:
- The Fund’s purpose in the Articles of Agreement: to “promote international monetary cooperation through…..consultation and collaboration on international monetary problems”.
- Current IMF priorities articulated:
- Revamp the IMF’s governance structures this year to better reflect the new global economic order and increase Asia’s voice in the IMF’s governance.
- Increase the presence of Asian staff at the IMF.
- Change how the IMF interacts with members in Asia to better benefit from regional experiences.
- Consider options to improve the financial safety net and form a more effective network of peer assessment by building on the G-20 MAP.
- Policy rationale: Asian leadership is needed both to sustain global growth and to develop policy mechanisms for future challenges.
Source: IMF blog post “Turning up the Volume—Asia's Voice and Leadership in Global Policymaking” by Naoyuki Shinohara, July 11, 2010.