Amorim and Camdessus advocate for reforms in global governance to respond to current challenges

Former Director of the International Monetary Fund (IMF) and former President of the Banque de France, Michel Camdessus, and former Brazilian Foreign Minister, Celso Amorim, highlighted the need and urgency of forging a new global governance system that reflects and responds to the challenges posed by the changing global context-a task for which they considered key the ability to reach consensus and coordination.

During the new edition of the program "Conversando con CAF" published on February 3, Enrique Garcia, Executive President of CAF -Development Bank of Latin America-, together with Camdessus and Amorim agreed on highlighting that the new reality, characterized by a process of rapid change, poses significant challenges to the international community.

"Today we have the dangers of rising crises, of growing inequality, climate change and collective security," indicated Camdessus, former President of the Banque de France. "It is evident that the institutions generated after World War II cannot keep up today and respond to contemporary challenges, which are totally different," he claimed.

For Amorim, the creation of the Group of 20 (G-20) marked an advance toward better governance in the financial sector because it has more representation than the G-7, although he considered that there is still much to do in other aspects.

"In the case of peace and security, power is still completely centralized in the five countries that won World War II and who have, in addition, the atomic bomb," he emphasized.

Garcia highlighted how CAF's governance model has served to adequately respond to the new realities. The Executive President emphasized two aspects which, in his view, are applicable to other entities: a non-resident board and the right to equal vote. 

 "I would like for the IMF to follow CAF's example," said Camdessus.

The growing weight of emerging markets and the volatility of financial systems were some of the challenges brought up during the conversation, and all agreed that, to respond, a greater level of coordination is required.

Amorim stated that in Latin America, there is a "growing awareness" of this need for cooperation and coordination, but admitted that it is "not yet spontaneous." On that same note, Garcia mentioned the importance of "strengthening the mechanisms of internal coordination" in the region, which in his opinion depends on the quality of the political institutions.

Furthermore, Camdessus referred to the global financial instability in recent years and considered that one urgent action is to reform the coordination instruments among the economies to avoid misalignments that generate volatility. "This needs to be done now," he emphasized, while also advocating for "reforming the international monetary system much more ambitiously."

A summary of the conversation is available at www.conversandoconcaf.com (in Spanish).