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Final Report and Recommendations On “Addressing Systemic Issues”

September 12, 2005

ffdfinalrecommendationsOrganized by New Rules for Global Finance Coalition -- November 2004 through September 2005

On “Addressing Systemic Issues”, Section F, Monterrey Consensus Document International Conference on Financing for Development Monterrey, Mexico, March 2002

Paper prepared for UN 2005 World Summit, Segment on Financing for Development, September 14-16, 2005

The New Rules for Global Finance Coalition has worked for the past year on Multi-Stakeholder Consultations on Systemic Issues in order to promote implementation of Section (F) of the Monterrey Consensus Document. In each of five sessions—in Washington, DC at the IMF; in Lima, Peru; in Nairobi, Kenya; in New Delhi, India; in New York City at the United Nations — New Rules has worked with other multi-stakeholder participants to identify well-researched and politically viable policy proposals that could leverage significant change toward the goals articulated at the Monterrey Conference.

Each session explored the same core agenda:

  1. Assessment of official steps taken to prevent and reduce global financial crises;
  2. Policy proposals to prevent financial crises;
  3. Policy proposals to provide credit to countries in financial crises;
  4. Mechanisms to manage risks arising from financial crises; and
  5. Governance of the IMF, World Bank, and other financial rule-making bodies, including the Bank for International Settlements, the Financial Stability Forum, and the Basle Committees.

Click here for full details on the Consultations.

Download Final Report and Recommendations Derived from Multi-Stakeholder Consultations


Table of Contents

I. Introduction

A. Goal of the Multi-Stakeholder Consultations on Systemic Issues

B. Assessment of the Status Quo

C. Report’s Recommendations

II. Recommendations: Preventing Financial Crises

A. Prudential Regulation of Financial Markets

B. Counter-Cyclical Policies

C. International Lending In Local Currency

D. Commodity Price Risk Management

III. Recommendations: Healthy Financing for the Real Economy--Insurance Against Financial Crises

A. Taxes, the Real Economy and Financial Crises

B. Policies to Support the Productive Economy, National Development Banks

C. Micro-Finance

IV. Recommendations: When Crises Strike

A. A Comprehensive Framework for Sovereign Debt Restructuring In Middle-Income Countries

B. IMF: Liquidity in Times of Crisis

C. Responding To Exogenous Shocks

V. Governance

A. Governance of the World Bank and the International Monetary Fund

B. Governance of Financial Agenda and Standard-Setting Bodies

Final Recommendations