The Essential Reform of the International Monetary System

Authors: Anoop Singh, Bernard Snoy and Michel Camdessus

Let’s face it squarely, the global economy is at an impasse. It is now obvious that the needs resulting from climate change, multiple attacks on the environment, threats of pandemics, the unbearable debt burden of many countries, demographic growth, the ravages finally created by the conflicts in Ukraine, Sudan, Ethiopia and so many other countries are upsetting the financial balance envisaged at recent major international conferences.

The resources necessary to meet the most reasonably assessed needs are scarcely available, even if we count on the full implementation of decisions which have just been taken or which should be taken in the aftermath of the Marrakech conference and the work of the Paris Summit in July 2023. In one word, the fundamental equation of the world economic balance does not come full circle! We cannot resign ourselves to this: it announces, in fact, an unacceptable future, it already feeds the concern and even the revolt of the world’s youth, threatened with a future of growing inequalities and dramatic shortages unworthy of man. Facing it, the world community must therefore take a major initiative without delay, while working to restore peaceful relations and trusting cooperation between countries.

One of the central elements of this initiative should be the reform of the international monetary system (IMS). Some work has been done in this direction in recent years. It has led to the adoption of a few useful but limited measures; the complexity of the issues has too often led governing bodies to postpone the discussion or the adoption of a comprehensive program. Such a reform has never been as indispensable as today, but we must recognise that the present climate of confrontation among key-partners does not allow for the in-depth debates, which would be required. It should not prevent us, nevertheless, to prepare for the moment when the circumstances turn to be more propitious for these negotiations, by trying to identify the basic pillars of a renovated central institution of the system, namely:
– An unquestionable fairness,
– An adjusted mandate,
– A strengthened world monetary governance.

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