Wither The Institutional Savior?

It has been all too plain to see right now, from the carbon emission issues right up to the current financial crisis, we just do not see any global institution capable of taking central stage to tackle international crisis.

Without a doubt, U.S. Federal Reserve and Treasury are taking the central roles to contain the financial crisis that is escalating to the global level, along with E.U. governments which also initiate their own rescue plans. Asia and Latin America take the wait and see approach while African nations are appealing to aid donors against taking any hasty decision in slashing foreign aids. What we see is essentially a series of unilateral and multilateral actions which may inadvertently turn into beggar thy neighbor policies hurting other countries.

Take a brief look on the contentious carbon emission issues, we simply do not see a concerted effort through an effective global institution to act decisively. E.U. governments try to play leadership roles but only with great uncertainty clouding around the funding issues due to the subsequent fiscal tightening as much money has been channeled to the financial rescue packages. Meanwhile the Kyoto protocol is not even able to exert the expected influence as the largest polluters in the world are conspicuously missing from the agreement either through exemption or reluctance to sign the agreement.

Enough said, in principle the relevance of global institutions is really beyond doubt as nations are more interconnected than ever before in globalization age, collective effort conceived at international stage is imperative to resolve global issues. But why are they largely on the sidelines right now?

The central question is to really figure out the reform necessary for these global institutions to become more relevant. We need to find out what they are lacking of and in what areas they really need to do more. Take IMF for example, they are apparently lacking the expertise to handle financial crisis originated in developed western countries, and their policy making needs to be more neutral and representative to all nations as their failure in this area can be seen through their much criticized recommendation during East Asia financial crisis in late 1990s. If we claim current global issues do not require the involvement of global institutions as yet, it is not because they are not needed but we are only reinforcing the fact how ineffectual they are in handling global issues.