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THE IMPACT OF THE GLOBAL RECESSION TO MULTI-NATIONAL CORPORATIONS AND THE INTERNATIONAL FINANCIAL INSTITUTIONS
By
Kaycie Woodard
Fin 534
International Finance Final Research Paper
Introduction
There is a broad, global systemic crisis with environmental, social, economic and democratic dimensions (Two Summits and a Hemisphere at the Crossroads, 2009).
There is a need for new structures and a new paradigm. European civil society groups have proposed deep reforms to international financial institutions and policies and are determined to persuade European governments to back these now. Developing countries are paying the consequences of a crisis for which they are not responsible. Strengthening solidarity with developing countries is a vital matter both of ethics and of self-interest (Two Summits and a Hemisphere at the Crossroads, 2009).
The world’s poor will be hard hit by a financial crisis and ordinary citizens in all regions are suffering. They will pay the bill for the multi-billion bank bail outs, through higher taxes, or less spending on public goods other than financial stability. Never before has there been such a broad consensus that the current financial system does not work properly, has resulted in an inequitable transfer of resources to a narrow group of richer people and an unsustainable pressure on natural resources, and has to be transformed (Two Summits and a Hemisphere at the Crossroads,2009).
The public anger offers a unique opportunity that must not be wasted.
Several countries, including European ones, have already needed emergency assistance from the IMF. The IMF and its sister organisation the World Bank have played a part in making countries vulnerable to such a crisis (Wedgwood, 2009). Their conditionality has limited policy space and promoted financial deregulation and liberalisation. Conditionality has also guided the reduction of State’s intervention in areas of public interest, including the provision of public...
By
Kaycie Woodard
Fin 534
International Finance Final Research Paper
Introduction
There is a broad, global systemic crisis with environmental, social, economic and democratic dimensions (Two Summits and a Hemisphere at the Crossroads, 2009).
There is a need for new structures and a new paradigm. European civil society groups have proposed deep reforms to international financial institutions and policies and are determined to persuade European governments to back these now. Developing countries are paying the consequences of a crisis for which they are not responsible. Strengthening solidarity with developing countries is a vital matter both of ethics and of self-interest (Two Summits and a Hemisphere at the Crossroads, 2009).
The world’s poor will be hard hit by a financial crisis and ordinary citizens in all regions are suffering. They will pay the bill for the multi-billion bank bail outs, through higher taxes, or less spending on public goods other than financial stability. Never before has there been such a broad consensus that the current financial system does not work properly, has resulted in an inequitable transfer of resources to a narrow group of richer people and an unsustainable pressure on natural resources, and has to be transformed (Two Summits and a Hemisphere at the Crossroads,2009).
The public anger offers a unique opportunity that must not be wasted.
Several countries, including European ones, have already needed emergency assistance from the IMF. The IMF and its sister organisation the World Bank have played a part in making countries vulnerable to such a crisis (Wedgwood, 2009). Their conditionality has limited policy space and promoted financial deregulation and liberalisation. Conditionality has also guided the reduction of State’s intervention in areas of public interest, including the provision of public...