NYU-A6-WL
Wenyi Lai
Oct. 29, 2000
P11.2210: International Organization and Their Management: The United Nations
Ambassador Ahmad Kamal
Three Suggestions for Reformatting the International Financial System
Introduction:
The international financial system included 1)the International Monetary Fund, with
responsibility for maintaining currency exchange stability and helping member nations to keep
monetary stability, 2)the World Bank, with responsibility for aiding in the reconstruction or
modernization of developing countries, 3)and the World Trade Organization to promote
international trade and govern trade regulations. These institutions were supposed to function
within the general framework of the UN system. But in fact, each is involved in its own fund-
raising and decision-making operations.
I argue that the primary issues of international financial system are distribution and legitimacy.
The distribution issues focus on the dilemma of politics and economics in the allocation of
scarce resources and values. The legitimacy issues focus on the effectiveness and process of the
international financial institutions. My three suggestions will concentrate on these issues and
give a clear picture of how to reformat the international financial system.
Three Suggestions:
1. Strengthening the UN・s authority in international financial affairs
2. Abolishing the IMF・s conditional debt system
3. Promoting the liberalization and globalization
1. Strengthening the UN・s authority in international financial affairs: Control of World Bank,
IMF and WTO group operations by Western powers. This made the international financial
institutions lose their legitimacy. And this also made the distribution unfair. I suggest
strengthening the UN・s role in decision-making of these institutions. Because the UN is a forum
that included more opinions from the whole world and it will make the functions of international
financial system more effective.
2. Abolishing the IMF・s conditional debt system
The IMF・s role to stabilize international financial order is very important. But debtor countries
always criticize IMF・s programs which even worsened the economic situation in debtor
countries. The IMF usually attaches conditions to large borrowing, designed to help remedy the
problems. But in fact, because of the complicated politico-economic situation, the IMF・s
programs gave too much pressure to debtor countries. I suggest abolishing the IMF・s
：conditionality.； I argue the IMF should be a pure creditor institution which will its legitimacy.
3. Promoting the liberalization and globalization: I argue that the conception of ：free-trade； will
benefit each states in this world in the long run. We should strengthen the function of the WTO
and expand the participation. The WTO・s process of liberalization and globalization met
obstacles from labour organization, environmentalist organization, etc. The opinions from each
organization should be consulted and discussed. But we can・t stop to move forward to economic
prosperity.