Sara Hsu
 Global
Governance Institutions: a
parable
 The
threat to globalization is not the
wasted American dollars but Washington's
readiness to mix US commercial interests
with its self-appointed role as global
protector. -- William Greider
 The
world is governed by institutions that
are not democratic - the World Bank, the
IMF, the WTO. -- Jose Saramago
 Global
governance: Global governance
is the political and economic interaction
of transnational actors aimed at solving
problems that affect more than one state
or region. Usually there is no “hard”
power of enforcing compliance. The
primary institutions of global governance
are the United Nations, World Trade
Organization, World Bank, and
International Monetary Fund.
 The
United Nations is an international
organization founded in 1945 after the
Second World War by 51 countries
committed to maintaining international
peace and security, developing friendly
relations among nations and promoting
social progress, better living standards
and human rights.
 To
keep peace throughout the world;
 To develop friendly relations among
nations;
 To help nations work together to improve
the lives of poor people, to conquer
hunger, disease and illiteracy, and to
encourage respect for each other’s rights
and freedoms;
 To be a centre for harmonizing the
actions of nations to achieve these goals.
The World Trade Organization (WTO) is the only
international organization dealing with the
global rules of trade between nations. Its main
function is to ensure that trade flows as smoothly,
predictably and freely as possible.
 It does this by:

Administering trade agreements
Acting as a forum for trade negotiations
Settling trade disputes
Reviewing national trade policies
Assisting developing countries in trade policy issues,
through technical assistance and training programs
• Cooperating with other international organizations
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1. The system helps promote peace
2. Disputes are handled constructively
3. Rules make life easier for all
4. Freer trade cuts the costs of living
5. It provides more choice of products and
qualities
6. Trade raises incomes
7. Trade stimulates economic growth
8. The basic principles make life more efficient
9. Governments are shielded from lobbying
10. The system encourages good government
 Established
in 1944, the World Bank is
headquartered in Washington, D.C. The
World Bank is not a bank in the ordinary
sense but a unique partnership to reduce
poverty and support development.
 The World Bank comprises two institutions
managed by 188 member countries: the
International Bank for Reconstruction and
Development (IBRD) and the International
Development Association (IDA), reducing
poverty in middle-income and creditworthy
poorer countries, and in the world’s poorest
countries respectively.
 The
Poorest Countries: Many of the UN's
Millennium Development Goals for 2015
seem out of reach for the world's poorest
countries. An estimated 1.4 billion people
survive on incomes of $1.25 or less a day.
 Middle-Income Countries, Middleincome countries are still home to most of
the world’s poor people, often with a heavy
concentration in specific regions or ethnic
groups.
 Post-Conflict
and Fragile States: Many of the
world's poorest countries have faced a
vicious cycle of conflict and poverty. Some
80 percent of the 20 poorest countries have
suffered a major war in the past 15 years,
bringing extraordinary suffering to their
people and often affecting the larger region.
The Arab World: The Arab world has strong
potential for growth and development, but it
remains poorly integrated into the global
economy apart from the oil sector.
 Global
Public Goods: Global public
goods are aspects of development that
reach across borders
 Knowledge and Learning: Poor and
developing countries seek the World
Bank Group’s expertise as much as they
seek its financial assistance. As clients,
they increasingly expect integrated
solutions to address their particular
needs.
 The
International Monetary Fund (IMF) is an
organization of 188 countries, working to
foster global monetary cooperation, secure
financial stability, facilitate international
trade, promote high employment and
sustainable economic growth, and reduce
poverty around the world.
 The IMF provides policy advice and
financing to members in economic
difficulties and also works with developing
nations to help them achieve
macroeconomic stability and reduce
poverty.

The IMF supports its membership by providing
• policy advice to governments and central banks based on
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analysis of economic trends and cross-country
experiences;
research, statistics, forecasts, and analysis based on
tracking of global, regional, and individual economies
and markets;
loans to help countries overcome economic difficulties;
concessional loans to help fight poverty in developing
countries; and
technical assistance and training to help countries
improve the management of their economies.

The phrase “Washington Consensus” is often seen as
synonymous with “neoliberalism” and
“globalization.” These policies were:
• Fiscal discipline
• A redirection of public expenditure priorities toward fields
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offering both high economic returns and the potential to
improve income distribution, such as primary health care,
primary education, and infrastructure
Tax reform (to lower marginal rates and broaden the tax base)
Interest rate liberalization
A competitive exchange rate
Trade liberalization
Liberalization of inflows of foreign direct investment
Privatization
Deregulation (to abolish barriers to entry and exit)
Secure property rights
 Neoliberalism
is an ideology based on
the advocacy of economic liberalizations,
free trade, and open markets.
Neoliberalism supports privatization of
state-owned enterprises, deregulation of
markets, and promotion of the private
sector's role in society. In the 1980s, much
of Neoliberal theory was incorporated
into mainstream economics