Event summary: Multilateral Institutions
–
indispensable or irrelevant to global peace and prosperity?
Monday 25 November 2019 at Hudson Institute.
By Liselotte Odgaard
Key take-aways:
The US public remains strongly committed to multilateralism, recognizing that international
cooperation is necessary to serve US interests.
The US has a tough love approach to multilateral institutions which combines engagement with
demands for transparency, effectiveness and burden-sharing.
A coalition of the willing that share the same values is necessary to reform the multilateral
institutions so they can effectively carry out peacekeeping and development in fragile states
where lack of legitimacy, trust, delivery of public goods and accountability now bedevil these
efforts.
Multilateralism is no longer an altruistic project, it is a project of enlightened self-interest, and
there is no other answer than to engage in it to make it better.
Kathryn Lavelle, Professor at Case Western Reserve University:
In some of their darkest hours, people have tried to figure out what to do about multilateral institutions.
This is the centuries-long history of multilateral institutions. Currently, the multilateral institutions have
to adapt to the global integration that has taken place in the digital era. Constituencies matter. We have
to explain to people in industrial democracies why institutions such as the UN and the World Bank
atter. Chi a s parti ipatio i a rules-based
system via multilateral institutions gives us leverage. For
example, when China participates in a World Bank package, the international community has
opportunities to influence Chinese policies. The institutions and the problems they deal with are
interconnected. For example, there is a lot of connections between environmental, climate, refugee and
human rights issues. Our system is ill-equipped for these institutions to interact with each other so they
can address these problems. Support for multilateralism remains strong in the US public because some
issues can only be addressed by the international community.
Eli Whitney Debevoise II, former executive director of the World Bank:
Why does China continue to borrow from the World Bank? It is time for China to graduate and pay for
development assistance. The World Bank director responsible for ethics is Chinese, but if he is found not
to do his job the president can fire him. New institutions are usually dependent on established
institutions for access to their facilities. For example, for access to the monetary facilities of the BRICS
bank, now called the New Development Bank, only 30 per cent can be taken with no questions asked,
the other 70 per cent requires an upper tranche IMF program. The Asian Infrastructure Investment Bank
(AIIB) is largely populated with staff from old institutions such as the World Bank and they have co-
financing arrangements with these. China is setting up multilateral institutions in which they can be the
predominant voice. The position of US director of the World Bank is important to setting the tone as
competition unfolds around the world. The US has approved of the capital increase of the World Bank
this year, on condition that rich countries pay more for loans that poor countries, that the budget is cut
for top-level salaries, and a number of other reforms. This tough love approach is usually the most
appropriate for US engagement in multilateral institutions.
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