Peterson Institute publications
The Peterson Institute for International Economics is a private, nonprofit, nonpartisan
research institution devoted to the study of international economic policy. More › ›
RSS News Feed Search

Working Paper 11-16

Asia and Global Financial Governance

by C. Randall Henning, Peterson Institute for International Economics
and Mohsin S. Khan, Peterson Institute for International Economics

October 2011

View full document [pdf]

The remarkable growth of Asian economies and their integration in global trade and finance has given them considerable potential clout in international forums and institutions. However, Asia's influence in the International Monetary Fund and the Group of Twenty (G-20)—the most important institution and decision-making forum in global finance, respectively—is not yet commensurate with its economic weight. Henning and Khan find that this is partly the result of a conscious choice by Asian countries to keep the Fund at arm's length, reflecting the bitter memories of the Fund's role in the 1997–98 Asian financial crisis and more recent disputes over surveillance. But it is also due to the fact that Asia has not, at least until recently, asserted itself in global financial circles. There are welcome signs now of Asia doing so, demanding greater voice and representation through increases in quota shares in the Fund. Given Europeans' resistance to further reducing their quotas and votes, however, Asian countries will need to persist, establish unified positions on matters of regional and systemic importance, and lead a substantive agenda for the Fund. Playing its rightful role in the Fund need not detract from Asia's existing regional financial arrangements, including the possibility of eventually creating an Asian Monetary Fund. Within the G-20, Asia should seek to form common ground and coalitions with other members, and the Asian members of the G-20 should seek out and reflect the views and concerns of Asian countries that are not members of the G-20. These two actions could both strengthen the position of Asian countries in the G-20 and give voice and a stake to all Asian countries.


Op-ed: Asia: Stepping Up from Regional Influence to a Global Role October 16, 2011

Policy Brief 14-9: IMF Reform Is Waiting on the United States March 2014

Policy Brief 13-7: The Congress Should Support IMF Governance Reform to Help Stabilize the World Economy March 2013

Book: A Strategy for IMF Reform February 2006

Working Paper 11-5: Integrating Reform of Financial Regulation with Reform of the International Monetary System February 2011

Policy Brief 10-29: Strengthening IMF Surveillance: A Comprehensive Proposal December 2010

Working Paper 10-14: Reform of the Global Financial Architecture October 2010

Testimony: The Role of the International Monetary Fund and Federal Reserve in the Stabilization of Europe May 20, 2010

Op-ed: How the Fund Can Help Save the World Economy March 5, 2009

Article: Economists Seek IMF Reform January 26, 2009

Policy Brief 07-1: The IMF Quota Formula: Linchpin of Fund Reform February 2007

Op-ed: The IMF Should Heed This Resignation July 25, 2012