Cooperation and Contest in Global and Regional Financial Safety Nets
- P.M. Erza KillianAffiliated withInternational Relations Department, Universitas Brawijaya
The aftermath of major regional and global financial crisis always has tremendous impact on regional and global political and economic landscape. In several major regions of the world, financial crisis has led to the establishment and/or expansion of regional financial safety nets (FSNs), which acts a complement to current multilateral or global financial safety nets such as IMF. However, the establishment and expansion of these regional safety nets is not without consequences. This paper finds that regional safety nets, which came in line with the spirit of regionalism and regional integration, has major impacts on global financial architecture. First, it has created a new level of financial cooperation, in addition to the existing ones (namely the bilateral and multilateral level), including adding new actors to the financial system such as the regional monetary union. Second, regional FSNs are results of political action within states and among states which can affect its relationship with IMF. In this sense, at the time of crisis, countries need to bargain and cooperate at the domestic level, regional level and multilateral level simultaneously. Third, due to regional political consideration, countries may opt to lending and borrowing activities at the regional level, and increase the incentives for countries to do forum shopping. In sum, the development and growing importance of regional financial safety nets in global and regional politics should be assessed more carefully, particularly regarding its relationship with IMF.
Keywords:Financial safety nets Regionalism IMF
- Cooperation and Contest in Global and Regional Financial Safety Nets
- Open Access
- Available under Open Access This content is freely available online to anyone, anywhere at any time.
GSTF Journal of Law and Social Sciences (JLSS)
- Online Date
- July 2015
- Online ISSN
- Global Science and Technology Forum
- Additional Links
- Financial safety nets
- Author Affiliations
- 1. International Relations Department, Universitas Brawijaya, Brawijaya, Indonesia