Global Governance in the 21st Century
Multilateral institutions can be effective only as far as their shareholders allow. In response to the COVID-19 crisis, the International Monetary Fund has simplified its procedures and provided unprecedented support to its members. But not all institutions have risen to the challenge, and developing economies still desperately need more multilateral support.
The World Health Organization should be the force of rapid response through which the world confronts global health issues, but it has been undermined at a time when the world urgently needs it. While global trade needs a boost, trade wars and blocking appointments and needed reforms are preventing the WTO from being effective.
China-based institutions are becoming increasingly important, including the Asian Infrastructure Investment Bank and the suite of bilateral agreements that underpin the Belt and Road Initiative. It is necessary to work with these institutions and not against them, given that solving global problems requires more strength and coordination. The increase in the diversity of workers also contributes to enhancing effectiveness and legitimacy. The larger the scope of participation, the more a source of strength, not anxiety.
In addition to the rise of new powers and the increase in the diversity of government opinions and approaches, the growing role of private sector companies in the global architecture must be taken into account. Lost
Amazon Web Services and Google Cloud are now part of the infrastructure affecting the financial system, while Amazon Marketplace has become one of the most important companies in the field of commerce. Facebook has become one of the most important systems for disseminating public health information, and Alibaba is a source of personal protection devices, and Apple and Google have also led the West's efforts to track contacts through electronic applications.
As usual, the next crisis will be outside the limits of our old mental schemes, and therefore partnerships should be formed with the parties that realize the nature of the new reality in preparation for facing the crisis. But the position of the private sector will not always be supportive, so we need independent regulatory bodies capable of tightening control over successful companies that represent a rising power. It is also necessary to constantly renew technical expertise to ensure that the experience of the financial crisis does not recur, when experts and regulators failed to understand the nature of credit derivatives, in the event that new threats emerge.
So the question arises:
China-based institutions are becoming increasingly important, including the Asian Infrastructure Investment Bank and the suite of bilateral agreements that underpin the Belt and Road Initiative. It is necessary to work with these institutions and not against them, given that solving global problems requires more strength and coordination. The increase in the diversity of workers also contributes to enhancing effectiveness and legitimacy. The larger the scope of participation, the more a source of strength, not anxiety.
In addition to the rise of new powers and the increase in the diversity of government opinions and approaches, the growing role of private sector companies in the global architecture must be taken into account. Lost
Amazon Web Services and Google Cloud are now part of the infrastructure affecting the financial system, while Amazon Marketplace has become one of the most important companies in the field of commerce. Facebook has become one of the most important systems for disseminating public health information, and Alibaba is a source of personal protection devices, and Apple and Google have also led the West's efforts to track contacts through electronic applications.
As usual, the next crisis will be outside the limits of our old mental schemes, and therefore partnerships should be formed with the parties that realize the nature of the new reality in preparation for facing the crisis. But the position of the private sector will not always be supportive, so we need independent regulatory bodies capable of tightening control over successful companies that represent a rising power. It is also necessary to constantly renew technical expertise to ensure that the experience of the financial crisis does not recur, when experts and regulators failed to understand the nature of credit derivatives, in the event that new threats emerge.
So the question arises:
What are the four new barriers? What are the biggest barriers to reforming global institutions?
We can fight disease, war, famine, and death - which we have done in the past - but that requires us to confront the four new barriers: excessive focus in the short term, nationalism, cost, and influence in state apparatus. Voters can prevent governments from taking action in the long term and can support protectionist policies, while governments themselves have limited resources and feel the need to prioritize current pressing issues rather than looming vital issues. And it is clear from the Covid-19 crisis that the presence of true will with which to overcome all four new barriers
Politicians are focused on a limited period of time and focus on current issues, but voters wary of the COVID-19 pandemic will demand long-term solutions. Leaders in the United States, the United Kingdom, Russia, Brazil, and other countries are facing mounting criticism over their response to the pandemic, and voters will not forgive governments that prove unprepared again. History will also not forgive the generation of leaders who failed to prevent catastrophic climate change. As we learned from inspiring leaders who succeeded in forging a new world order in conjunction with their participation in World War II, focusing on both short and long-term challenges is possible. Shareholders in global institutions and private companies should do the same.
The health and economic emergency resulting from the COVID-19 pandemic illustrates the necessity of coordinating global efforts. Preventing recurrences requires international cooperation to find vaccines. Avoiding chronic shortages of competent doctors and nurses requires opening the door for immigration. To address climate change, prevent future financial crises, and overcome poverty, we must reap the benefits of globalization and work decisively to address its weaknesses, especially the butterfly effect of systemic risks. High-income countries have the resources they need, and governments and voters only have to rearrange their priorities.
Governments around the world allocate an average of 6 percent of their expenditures to their armed forces and less than 1 percent of this amount to prevent pandemics that pose a greater threat to populations than war. At the international level, the World Health Organization’s budget is less than that of any major hospital in the United States. The rapid growth in response to the COVID-19 crisis shows that resources can be saved when there is a threat to the national interest. These lessons should be taken into account in the future.
The financial crisis has highlighted risks arising from herd thinking and the control of regulatory agencies by lobbyists. And to ensure the robustness of the systems, it is necessary to ensure the availability of knowledge and independence of officials to rein in the control-seeking parties that become more active and wealthier over time. The stalemate negatively affects institutional reform. It is imperative to address interest control over enterprises, to ensure that their governance, staff, and activities are consistent with the needs of the future rather than the needs of the past. The institutional space is rife with well-intentioned reform plans that have yet to be implemented.
Progress is possible, as evidenced by the fundamental changes that many institutions have undertaken. The European Coal and Steel Community, which was once a limited technical organization, is now the European Union, which has assumed a wide range of national responsibilities. The crisis could be a catalyst. The United Nations, the International Monetary Fund, the World Bank, the Marshall Plan, and the Welfare State were all conceived in the midst of World War II. In recent months, the International Monetary Fund approved a record number of loans in record time and on lower terms, while its experts were working remotely. National governments ditched the old rules and provided direct support to workers and companies. Thus, what seemed impossible in the past was achieved.
The devastation caused by the COVID-19 pandemic is prompting us to redouble our efforts to create a fairer and more inclusive world for all. This requires addressing the risks that threaten our lives and exacerbate inequality, poverty, and climate change. Building a solid and sustainable future requires that we all act, from the individual level to the global level. International cooperation is necessary not only between governments but through civil society, companies, and professionals. Our current common problems require common solutions. We must take advantage of this crisis to build new, stronger bonds in our societies, countries, and the world at large