[go: up one dir, main page]
More Web Proxy on the site http://driver.im/
IDEAS home Printed from https://ideas.repec.org/p/ecb/ecbops/2018207.html
   My bibliography  Save this paper

Strengthening the Global Financial Safety Net

Author

Abstract
Since the global financial crisis, the Global Financial Safety Net (GFSN), traditionally consisting mainly of countries’ own foreign exchange reserves with the International Monetary Fund (IMF) acting as a backstop, has expanded significantly with the continued accumulation of reserves, the sharp increase of swap lines between central banks, and the further development and creation of new Regional Financing Arrangements (RFAs). RFAs have expanded, reaching an aggregate size comparable to that of the IMF and becoming an integral layer of the safety net. Enhancing the cooperation between the IMF and RFAs so that they play complementary roles in case of global distress, becomes critical in order to further strengthen the multi-layered GFSN, while paying attention to issues such as moral hazard, stigma or exit strategies in connection with IMF-RFA cooperation. This paper presents recent experience and lessons learned in IMF-RFA cooperation and proposes how to improve their future interaction. JEL Classification: F33, F34, F53, F55

Suggested Citation

  • IRC Taskforce on IMF Issues, 2018. "Strengthening the Global Financial Safety Net," Occasional Paper Series 207, European Central Bank.
    • Handle: RePEc:ecb:ecbops:2018207
    as

    Download full text from publisher

    File URL: https://www.ecb.europa.eu//pub/pdf/scpops/ecb.op207.en.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Stanley Fischer, 1999. "On the Need for an International Lender of Last Resort," Journal of Economic Perspectives, American Economic Association, vol. 13(4), pages 85-104, Fall.
    2. Jean Pisani-Ferry & André Sapir & Guntram B. Wolff, . "EU-IMF assistance to euro area countries- an early assessment," Blueprints, Bruegel, number 779, June.
    3. Edd Denbee & Carsten Jung & Francesco Patern�, 2016. "Stitching together the global financial safety net," Questioni di Economia e Finanza (Occasional Papers) 322, Bank of Italy, Economic Research and International Relations Area.
    4. Titelman Kardonsky, Daniel & Vera, Cecilia & Carvallo, Pablo & Pérez Caldentey, Esteban, 2014. "Un fondo de reservas regional para América Latina," Revista CEPAL, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), April.
    5. Mario Lamberte & Peter J. Morgan, 2012. "Regional and Global Monetary Cooperation," Finance Working Papers 23190, East Asian Bureau of Economic Research.
    6. Scheubel, Beatrice & Herrala, Risto & Stracca, Livio, 2016. "What do we know about the global financial safety net? Data, rationale and possible evolution," VfS Annual Conference 2016 (Augsburg): Demographic Change 145676, Verein für Socialpolitik / German Economic Association.
    7. Olivier Jeanne, 2010. "Dealing with Volatile Capital Flows," Policy Briefs PB10-18, Peterson Institute for International Economics.
    8. Barry Eichengreen, 2012. "Regional Financial Arrangements and the International Monetary Fund," Finance Working Papers 23354, East Asian Bureau of Economic Research.
    9. Axel Dreher & Roland Vaubel, 2004. "Do IMF and IBRD Cause Moral Hazard and Political Business Cycles? Evidence from Panel Data," Open Economies Review, Springer, vol. 15(1), pages 5-22, January.
    10. Corsetti, Giancarlo & Guimaraes, Bernardo & Roubini, Nouriel, 2006. "International lending of last resort and moral hazard: A model of IMF's catalytic finance," Journal of Monetary Economics, Elsevier, vol. 53(3), pages 441-471, April.
    11. Volz, Ulrich, 2012. "The need and scope for strengthening co-operation between regional financing arrangements and the IMF," IDOS Discussion Papers 15/2012, German Institute of Development and Sustainability (IDOS).
    12. Stracca, Livio & Scheubel, Beatrice, 2016. "What do we know about the global financial safety net? Rationale, data and possible evolution," Occasional Paper Series 177, European Central Bank.
    13. C. Randall Henning, 2011. "Coordinating Regional and Multilateral Financial Institutions," Working Paper Series WP11-9, Peterson Institute for International Economics.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Vinay Prasad Mandal & Raihan Ahmad & Sufia Rehman & Md Masroor & Haroon Sajjad, 2019. "Exploring optimal cereal crop sequence using cultivated land utilization index and yield in Katihar district, India: a sub division level analysis," Asian Journal of Agriculture and rural Development, Asian Economic and Social Society, vol. 9(1), pages 62-81, June.
    2. Shah, Ritesh & Cardozo, Mieke Lopes & Hjarrand, Jessica, 2024. "Learning as ecosystems: Shifting paradigms for more holistic programming in education and displacement," International Journal of Educational Development, Elsevier, vol. 104(C).
    3. Candelaria, John Lee & Sharifi, Ayyoob & Simangan, Dahlia & Tabosa, Rebeca Maria Ramos, 2023. "A critical analysis of selected global sustainability assessment frameworks: Toward integrated approaches to peace and sustainability," World Development Perspectives, Elsevier, vol. 32(C).
    4. Menashy, Francine & Zakharia, Zeena, 2023. "Partnerships for education in emergencies: The intersecting promises and challenges of SDG 4 and SDG 17," International Journal of Educational Development, Elsevier, vol. 103(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Scheubel, Beatrice & Stracca, Livio, 2019. "What do we know about the global financial safety net? A new comprehensive data set," Journal of International Money and Finance, Elsevier, vol. 99(C).
    2. Essers, Dennis & Ide, Stefaan, 2019. "The IMF and precautionary lending: An empirical evaluation of the selectivity and effectiveness of the Flexible Credit Line," Journal of International Money and Finance, Elsevier, vol. 92(C), pages 25-61.
    3. Cheng, Gong & Lennkh, Rudolf Alvise, 2018. "RFAs' Financial Structures and Lending Capacities: a Statutory, Accounting and Credit Rating Perspective," MPRA Paper 95754, University Library of Munich, Germany.
    4. Stracca, Livio & Scheubel, Beatrice, 2016. "What do we know about the global financial safety net? Rationale, data and possible evolution," Occasional Paper Series 177, European Central Bank.
    5. Scheubel, Beatrice & Stracca, Livio & Tille, Cédric, 2019. "Taming the global financial cycle: What role for the global financial safety net?," Journal of International Money and Finance, Elsevier, vol. 94(C), pages 160-182.
    6. Giancarlo Corsetti & Aitor Erce & Timothy Uy, 2017. "Official Sector Lending Strategies During the Euro Area Crisis," Discussion Papers 1720, Centre for Macroeconomics (CFM).
    7. Cheng, Gong, 2015. "The Global Financial Safety Net through the Prism of G20 Summits," MPRA Paper 68070, University Library of Munich, Germany, revised Nov 2015.
    8. Hal Hill & Jayant Menon, 2014. "Financial safety nets in Asia: genesis, evolution, adequacy and way forward," Chapters, in: Masahiro Kawai & Peter J. Morgan & Pradumna B. Rana (ed.), New Global Economic Architecture, chapter 5, pages 83-111, Edward Elgar Publishing.
    9. Jorra, Markus, 2012. "The effect of IMF lending on the probability of sovereign debt crises," Journal of International Money and Finance, Elsevier, vol. 31(4), pages 709-725.
    10. L´Hotellerie-Fallois, Pilar & Broos, Menno & Herrero, Sonsoles Gallego & Chamorro, Isabel Garrido & Vicente, Fernando López & Mukhopadhyay, Mayukh & Maurini, Claudia & Vonessen, Benjamin, 2018. "A quantitative analysis of the size of IMF resources," Occasional Paper Series 213, European Central Bank.
    11. Wei Cui, 2017. "Macroeconomic Effects of Delayed Capital Liquidation," Discussion Papers 1719, Centre for Macroeconomics (CFM).
    12. Luca Papi & Andrea F Presbitero & Alberto Zazzaro, 2015. "IMF Lending and Banking Crises," IMF Economic Review, Palgrave Macmillan;International Monetary Fund, vol. 63(3), pages 644-691, November.
    13. Giancarlo Corsetti & Aitor Erce & Timothy Uy, 2020. "Official sector lending during the euro area crisis," The Review of International Organizations, Springer, vol. 15(3), pages 667-705, July.
    14. Fernando Eguren Martin & Mark Joy & Claudia Maurini & Alessandro Moro & Valerio Nispi Landi & Alessandro Schiavone & Carlos van Hombeeck, 2020. "Capital flows during the pandemic: lessons for a more resilient international financial architecture," Questioni di Economia e Finanza (Occasional Papers) 589, Bank of Italy, Economic Research and International Relations Area.
    15. Gong Cheng & Dominika Miernik & Teuta Turani, 2020. "Finding complementarities in IMF and RFA toolkits," Discussion Papers 8, European Stability Mechanism, revised 25 Oct 2021.
    16. D. Essers & E. Vincent, 2017. "The global financial safety net :In need of repair ?," Economic Review, National Bank of Belgium, issue ii, pages 87-112, september.
    17. Jenny Kilp & Vafa Anvari & Samantha Springfield & Crystal Roberts, 2019. "The Impact of the Global Financial Safety Net on Emerging Market Bond Spreads," Russian Journal of Money and Finance, Bank of Russia, vol. 78(2), pages 43-66, June.
    18. Ulrich volz, 2012. "Strengthening Cooperation between Regional Financing," Papers and Proceedings 11855, Fondo Latino Americano de Reservas - FLAR.
    19. Ahuja, Rishi & Barrett, Sean & Corbet, Shaen & Larkin, Charles, 2019. "A way forward: The future of Irish and European union financial regulation," Economic Analysis and Policy, Elsevier, vol. 64(C), pages 346-360.
    20. Dennis Essers & Stefaan Ide, 2017. "The IMF and precautionary lending : An empirical evaluation of the selectivity and effectiveness of the flexible credit line," Working Paper Research 323, National Bank of Belgium.

    More about this item

    Keywords

    exit strategies; Global Financial Safety Net; International Monetary Fund; moral hazard; Regional Financing Arrangements; stigma;
    All these keywords.

    JEL classification:

    • F33 - International Economics - - International Finance - - - International Monetary Arrangements and Institutions
    • F34 - International Economics - - International Finance - - - International Lending and Debt Problems
    • F53 - International Economics - - International Relations, National Security, and International Political Economy - - - International Agreements and Observance; International Organizations
    • F55 - International Economics - - International Relations, National Security, and International Political Economy - - - International Institutional Arrangements

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ecb:ecbops:2018207. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Official Publications (email available below). General contact details of provider: https://edirc.repec.org/data/emieude.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.