Comments on: Regional Financial Governance: Lessons from the Eurozone http://triplecrisis.com/regional-financial-governance-lessons-from-the-eurozone/ Global Perspectives on Finance, Development, and Environment Thu, 09 Feb 2012 15:49:02 +0000 hourly 1 http://wordpress.org/?v=3.0.1 By: Ilene Grabel http://triplecrisis.com/regional-financial-governance-lessons-from-the-eurozone/comment-page-1/#comment-462 Ilene Grabel Wed, 21 Apr 2010 14:35:23 +0000 http://triplecrisis.com/?p=423#comment-462 Excellent points, Bill--thanks! I especially like the argument about the way that the CMIM (despite its insufficient institutionality, at least based on what we know about the agreement) increases the bargaining power of countries in the region vis-a-vis the IMF. That alone is an important achievement as far as potential policy space. Excellent points, Bill–thanks! I especially like the argument about the way that the CMIM (despite its insufficient institutionality, at least based on what we know about the agreement) increases the bargaining power of countries in the region vis-a-vis the IMF. That alone is an important achievement as far as potential policy space.

]]> By: William Grimes http://triplecrisis.com/regional-financial-governance-lessons-from-the-eurozone/comment-page-1/#comment-428 William Grimes Mon, 19 Apr 2010 23:18:36 +0000 http://triplecrisis.com/?p=423#comment-428 Nice post, Ilene. A lot of questions still surround CMIM, at least partly because participants have decided to not to make the actual agreement publicly available. Luckily, this post gets the essentials right on both CMI and CMIM. The one important element that should be added to your brief assessment is that the issue that is generally short-handed as "surveillance" is only partly about surveillance. Really, this is a question of enforcement more than monitoring, and the leading countries (Japan and China) have made the strategic decision that they would prefer to delegate decisionmaking rather than be put in the position of having to enforce harsh conditions on an ASEAN+3 partner. Although CMIM calls for an independent surveillance unit, it is hard to imagine how an ASEAN+3-created unit would be either highly competent or independent. In the absence of a better alternative, Japan and China are stuck with the IMF. Neither CMIM nor the Greek debacle is likely to change this. It is worth noting, however, that CMI (and CMIM even more so) constitute a credible threat of exit from the IMF conditionality regime. This means that the IMF will be unlikely to impose the kind of harsh conditions seen in 1997, for fear of making the latent "AMF threat" into a real one. This comment is getting quite long, so I will do the self-serving thing and refer any interested parties to my book Currency and Contest in East Asia, which goes into these and other issues in much greater detail. Bill Grimes Nice post, Ilene.

A lot of questions still surround CMIM, at least partly because participants have decided to not to make the actual agreement publicly available. Luckily, this post gets the essentials right on both CMI and CMIM.

The one important element that should be added to your brief assessment is that the issue that is generally short-handed as “surveillance” is only partly about surveillance. Really, this is a question of enforcement more than monitoring, and the leading countries (Japan and China) have made the strategic decision that they would prefer to delegate decisionmaking rather than be put in the position of having to enforce harsh conditions on an ASEAN+3 partner. Although CMIM calls for an independent surveillance unit, it is hard to imagine how an ASEAN+3-created unit would be either highly competent or independent. In the absence of a better alternative, Japan and China are stuck with the IMF. Neither CMIM nor the Greek debacle is likely to change this.

It is worth noting, however, that CMI (and CMIM even more so) constitute a credible threat of exit from the IMF conditionality regime. This means that the IMF will be unlikely to impose the kind of harsh conditions seen in 1997, for fear of making the latent “AMF threat” into a real one.

This comment is getting quite long, so I will do the self-serving thing and refer any interested parties to my book Currency and Contest in East Asia, which goes into these and other issues in much greater detail.

Bill Grimes

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