The International Monetary Fund usually gets headlines when it's negotiating an emergency loan with some country on the precipice of financial ruin. But the organization intersects with almost every sovereign goverment in much less dramatic fashion. Through its "surveillance" function, the IMF attempts to act as monitor and mentor to finance ministries and central banks around the world. Fund officials value their role as trusted and discreet advisors to national officials.
Through formal surveillance reports and informal conversations, the IMF does plenty of talking. But are its government interlocutors listening? And do they trust the Fund's intentions? The IMF's internal evaluation group recently released a report that attempts to assess how receptive governments are to Fund advice. Drawing on surveys with a broad range of national officials, the report offers mixed news. On the bright side, it finds that the Fund's reputation with member states has soared since the 2007-2008 financial crisis. National officials see the Fund as more responsive and less rigid in its advice:
The Fund staff is now seen as more open, listening more, and having a real dialogue. Indeed, this view was close to unanimous among the respondents to thecountry authorities’ survey. The Fund is perceived as more flexible and responsive. Almost 90 percent of country respondents agreed that the Fund had become more flexible in its approach to [loan] programs. Interviewees cited, for example, IMF support of fiscal stimulus; the shift to being able to use IMF financing for fiscal deficits; a significant drop in the amount of conditionality in programs; the IMF’s support of capital controls in some instances; and a less rigid approach on exchange rates.
But confidence in and receptivity to the Fund varies widely. The major industrialized economies are often "indifferent" to Fund advice, the report found. Most worryingly, the major emerging economies often don't trust the Fund, which they still see as dominated by and beholden to its advanced-country shareholders [emphasis added]:
A perception among some country authorities that the Fund is dominated by the interests of its largest shareholders undermined the view of the Fund as a trusted advisor. This notion was particularly prevalent among authorities in large emerging markets, almost half of whom noted that this perception, together with a sense of unequal treatment of countries by the IMF, influenced their decisions not to seek the IMF’s advice. These results were mirrored by those from both the mission chief and resident representative surveys, more than 40 percent of whose res pondents believed that the perception that IMF advice reflects the interests of the larger shareholders adversely affected their own capacity to be trusted advisors.
Government of South Africa
It now appears that Haruhiko Kuroda, currently the president of the Asian Development Bank (ADB), will take the helm at the Bank of Japan (BOJ). For weeks, Kuroda was thought to be one of several contenders for the spot, although most accounts didn't have him as the favorite. The most immediate implications of the appointment have to do with Japan's controversial currency moves. But the fact that Japanese Prime Minister Shinzo Abe has apparently reached for someone in a multilateral post is itself noteworthy.
It had appeared that Kuroda's ADB posting was hurting his chances. First, he was distant from Tokyo and no longer part of the inner finance ministry circle. Some recent reporting had also suggested that Japanese officials were worried about losing their leadership privileges at the ADB if Kurodo moved to the BOJ. A Japanese official has always led the Manila-based regional bank. Via the Wall Street Journal:
Some Japanese officials worry that if Mr. Kuroda leaves early for the BOJ slot, Japan risks losing the perch it has controlled since the founding of the Manila-based institution in 1966. For Japanese finance officials, the ADB is Japan's equivalent of the World Bank for the U.S. or the International Monetary Fund for Europe—an international financial institution they expect to run, a platform for global influence. Losing the ADB for Japan would be a blow, especially at time of growing insecurity about the country's diminished standing in the region.
It is unclear, however, whether Japan's hold would really be threatened, or whether that argument is being put forward by those advocating Mr. Kuroda's rivals.
It wouldn't be illogical for Japan to worry about its traditional ADB privileges. China has become an increasingly important ADB shareholder. What's more, the most recent leadership races at the World Bank and International Monetary Fund put new pressure on national privileges at key multilateral organizations. If Tokyo was in fact concerned about the ADB perch, it raises the possibility that the meritocratic wave in multilateral leadership is extending to regional organizations.
However, it now appears that those concerns were trumped by the perceived benefits of Kuroda's multilateral profile -- and that says something about the relationship between leadership in multilateral organizations and national governance. Kuroda undoubtedly acquired diplomatic skills at ADB that will serve him well at the BOJ, which has been under fire for its inflationary moves. As the New York Times' account put it, "Mr. Kuroda’s global experience could help Tokyo navigate that foreign criticism." There is evidence that Abe saw Kuroda's global experience as a decisive advantage over rivals who had only worked domestically:
Abe [commented] last week on the need for a new governor to have international contacts as a key qualification for the post, suggesting that he prefers someone with experience in financial diplomacy. Muto spent most of his career in domestic affairs, climbing the career ladder at the ministry of finance to become its top bureaucrat.
"Japan now needs a governor who can join, communicate and convince people in the inner circles of global finance," Abe told parliament on Wednesday.
But does the phenomenon of top officials sliding seamlessly between senior multilateral and national posts do violence to the already battered concept of international civil service? When officials take posts at the IMF, World Bank, the UN, or a regional organization, they pledge to work for the organization and, more broadly speaking, for the regional or international community. Doing that involves shedding -- or at least subsuming -- national loyalties. That's a hard task even when multilateral officials aren't thinking about a plum national post. Recent research by Liesbet Hooghe indicates that even top EU officials struggle to adopt a multinational mindset (hat tip to my AU colleague Mike Schroeder).
Increased fluidity between national and multilateral leadership posts may yield more savvy, experienced, and effective national officials, but it could also make the already tough task of producing credible international civil servants all the more challenging.
World Economic Forum
Reuters has a story up highlighting criticism of the G20 by European Central Bank board member Jörg Asmussen. He reportedly warned yesterday that the G20 might be running out of steam as a vehicle for economic and financial cooperation:
Asmussen, who attended the first G20 meeting in Berlin in 1999, working for the German finance ministry at the time, said the forum had lost momentum in recent years, also "to an important extent due to a waning sense of urgency".
"Global economic governance as we know it today seems to be well equipped to manage a global crisis. But it is less effective during normal times, which also lessens its ability to prevent future crises," Asmussen said in a speech in Berlin....
To revive the G20's power, Asmussen said it needed to adopt a more transparent decision-making process and a more focused and concise operational agenda.
At least as quoted, Asmussen's speech pretty much tracks the conventional wisdom on the G20: It played a useful role during the financial crisis but hasn't done much of value since. Its meetings now produce vague and ambiguous declarations that consume chunks of senior policymaker time to little apparent effect (witness the confusion over whether the G20 actually criticized Japan's currency moves).
This kind of criticism is fair enough as far as it goes. But it also implicitly devalues what is actually an extraordinary accomplishment: creating a global forum that can play a useful role during economic crises (even if it can't do much beyond that). As Daniel Drezner has pointed out repeatedly on his blog, avoiding cataclysmic outcomes is a big deal:
Formal and informal global governance structures still perform some important tasks at preventing worst-case scenarios from metastasizing, be it in security or economics. Call it "'good enough' global governance" -- it's not a new world order or anything, but it's also not as chaotic or dysfunctional as many pundits proclaim.
If G20 meetings and consultations during non-crisis periods do nothing more than keep lines of communication open and the crisis machinery well oiled, that's more than enough.
United Nations peacekeeping operations are, for the most part, paid for by the world's rich countries and staffed by poorer states. The G7 industrialized countries—Canada, France, Germany, Italy, Japan, the United Kingdom and the United States—pay a combined 71.6 percent of peacekeeping costs but contribute only about three percent of the more than 90,000 deployed UN peacekeepers and police. Eight countries, mostly low-income states, contribute more peacekeepers than the the G7 combined.
Source: United Nations
A new report by the International Peace Institute and the Pearson Centre examines the peacekeeping contributions of European states in particular and considers whether greater participation could be in the cards. With the Afghanistan operation drawing down, it points out, Europe may soon have spare personnel and resources that could be devoted to UN operations. There are plenty of obstacles, however, including political fatigue and shrinking military budgets. Memories of the failed Bosnia peacekeeping operation in the 1990s (to which European states contributed heavily) and doubts about UN command and control are also important. The whole report is worth a read.
Micah Zenko argues that the world needs a code of conduct for behavior in space—and that the United States should take the lead in negotiating one:
No country or group of countries possesses the sovereign authority or responsibility for regulating space. Outer space is instead governed by a patchwork of informal industry standards, unofficial UN guidelines, and bilateral agreements to prevent or mitigate potential satellite collisions and interference from space debris. As the leading country in space—and one that depends greatly on its assured availability—the United States has a core national interest to prevent or minimize the inherent risks of space activities. The United States should work with other spacefaring nations to establish a nonlegally binding international code of conduct for outer space activities. Specifically, the Obama administration should start negotiations building upon, but ultimately replacing, the current draft of the Space Code of Conduct put forth by the European Union (EU).
As Zenko acknowledges, an international code of conduct faces skepticism from both key developing countries—who worry that it would cement Western advantages—and from U.S. conservatives, mostly on sovereignty grounds.
RIA Novosti reports that a senior Russian security official wants more robust multilateralism on space threats:
“The Russian Security Council has repeatedly proposed to develop an interstate target program to counter space threats, such as asteroids, comets and space junk,” [Nikolai] Patrushev said in an interview with the Rossiyskaya Gazeta government daily, to be published in Wednesday’s edition.
“Preventing such threats requires the inter-governmental cooperation of states that have the ability to monitor and analyze the situation in near-Earth space,” the official said.
Qatar's prime minister, Hamed bin Jassim Al Thani, had some tough words for the European Union after it decided to extend its blanket arms embargo on Syria. Via the Guardian:
"I am astonished at this decision," Bin Jassim said. "The rebels only want to be able to defend themselves. At the present time this is the wrong decision. It will only prolong the crisis."
Qatar, along with Saudi Arabia, has supplied money and weapons to the anti-Assad forces but is understood to have been pressured by western governments to ease up because of growing concern that weapons are being funnelled to radical or jihadi groups that are not under the influence of the western-backed Syrian National Coalition. Rebel forces have complained that weapons and ammunition are drying up.
The European Union has resisted a British-led push to modify the EU arms embargo on Syria and allow weapons shipments to rebel forces. Via the Washington Post's Edward Cody:
Rejecting a push by Britain, European governments on Monday decided against providing weapons to Syrian rebel forces, expressing fears that more arms would only lead to more bloodshed in a conflict that already has taken nearly 70,000 lives....
The European Union imposed an arms embargo against Syria in May 2011, covering the government as well as the rebels, but it was scheduled to expire March 1. Monday’s decision renewed the ban for three more months, but, in what was portrayed as a compromise, it contained a promise to alter the terms to permit the supply of more nonlethal equipment designed to save civilian lives.
The relevant provision of the Council's conclusions reads as follows:
The Council agreed to renew the restrictive measures against Syria for a further three
months, amending them so as to provide greater non-lethal support and technical assistance for the protection of civilians. The Council will actively continue the work underway to assess and review, if necessary, the sanctions regime against Syria in order to support and help the opposition.
In the same meeting, the EU foreign ministers almost—but not quite—called for a referral of the Syrian violence to the International Criminal Court:
The EU calls on the UN Security Council to urgently address the situation in Syria in these aspects, including on a possible referral to the International Criminal Court as requested in the Swiss letter to the Security Council of 14 January 2013. The EU recalls that all those responsible for crimes against humanity and war crimes must be held accountable.
David Bosco reports on the new world order for The Multilateralist.