40 Years after the Breakdown of the Bretton Woods System: A New Geography of International Finance?
The conference, which was the only event during the IMF Meetings focusing specifically on the international monetary system, had the official support of the French presidency of the G20. The event allowed a fluid and interesting interaction between participants that sent the clear message that a new geography of the international economy requires a new international monetary system and hence the role of new currencies. There was consensus around the table that the world had lost its benchmark. Assets traditionally considered safe were no longer safe, and many were uncertain as to whether the system had sufficient incentives to produce such assets. US policies were described as no longer consistent with the requirements of a reserve currency. Safety nets were perceived as insufficient to support countries in distress. Yet, participants also recognized that there were neither sufficient resources nor the right institutions to rescue all countries. As next steps participants argued for an expansion of a safety net including new IMF facilities with some institutionalization of inter- central bank swap lines, a timetable for Renminbi liberalization, a framework for capital account management and a broadening of SDR basket.