The Need and Scope for Strengthening Co-Operation between Regional Financing Arrangements and the IMF

DIE Discussion Paper No. 15/2012

26 Pages Posted: 22 Dec 2012

See all articles by Ulrich Volz

Ulrich Volz

University of London - School of Oriental and African Studies (SOAS) - Economics; Deutsches Institut für Entwicklungspolitik (DIE) - German Development Institute (DIE)

Date Written: December 13, 2012

Abstract

This article makes the case for strengthening co-operation between regional financing arrangements (RFAs) and the International Monetary Fund (IMF), and examines ways to do so. It argues that ex ante co-operation between RFAs and the IMF is needed to reduce the risk of cooperation failing in the middle of a crisis, to help avoid “forum shopping” and institutional arbitrage, to prevent weakening the IMF’s role as the guardian of global financial stability, to minimise duplication, and to generate mutual benefits from a division of labour and specialisation based on the comparative advantages of the respective institutions. It calls for guidelines for organising the inter-institutional relations between the IMF and RFAs, a clear division of labour in crisis lending, and co-operation and exchange in surveillance and analysis. Co-operation with RFAs should be seen as a chance for the IMF to overcome its stigmatisation, strengthen its global role and ensure its continued relevance.

Keywords: IMF, regional financing arrangements, international co-operation, international monetary and financial stability

JEL Classification: F33, F34, F36

Suggested Citation

Volz, Ulrich, The Need and Scope for Strengthening Co-Operation between Regional Financing Arrangements and the IMF (December 13, 2012). DIE Discussion Paper No. 15/2012. Available at SSRN: https://ssrn.com/abstract=2192643

Ulrich Volz (Contact Author)

University of London - School of Oriental and African Studies (SOAS) - Economics

London, WC1E 7HU
United Kingdom

Deutsches Institut für Entwicklungspolitik (DIE) - German Development Institute (DIE) ( email )

Tulpenfeld 4
Bonn, 53113
Germany

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