The Organization of American States (OAS) today hosted a forum of officials and experts to discuss the theme "Global Governance and Reform of the International Financial System: Impact in the Americas," at the headquarters of the organization in Washington DC, attended by the Foreign Minister of Trinidad and Tobago, Winston Dookeran, and several international financial sector experts.
Upon opening the forum, the Secretary General of the OAS, José Miguel Insulza, explained the focus of the event, saying "the main issue here is not how to manage the crisis or what to do in the short term or the present, but rather how do we achieve a reform of the international financial system." "There is a lot of will to reform international governance," said the Secretary General, "but it doesn’t seem to be happening.”
"The international financial system has proved much more difficult to change than other international institutions," said the leader of the hemispheric institution, "and certainly the paradox is that we all seem to have learned something from the crisis; we gained some knowledge and experience of the crisis, without gaining the ability to make decisions that will allow us to predict, coordinate and improve the way we work in difficult times and in crisis situations."
Secretary General Insulza said that "the OAS has a critical role to play in working with civil society, business and governments to help lift the living standards of our citizens. This means not only enabling projects, giving away seed money or handing out scholarships, but bringing intellectual and strategic capabilities to inform the citizens of our hemisphere on the challenges ahead in addressing some of the key social issues.”
The forum was divided into two panels. In the first, entitled "Global Governance and Reform of the International Financial System," the Minister of Foreign Affairs of Trinidad and Tobago, Winston Dookeran said that while the financial sector in the Caribbean is strong, the region is in deficit. In this context, Minister Dookeran said it is necessary to ask, "How do we convert the strength of financial flows in the region to deal with the financial deficits in the public sector, and how do we do that and ensure that there is sustainability of confidence in the process?” “The financial challenge is one of development," he added, "in the region we are not isolated or shielded, so we have to adopt a strategy consistent with global developments."
The First Deputy Managing Director of the Institute of International Finance, Hung Tran, spoke of trade relations between China and Latin America, and explained that the trade and investment flows have increased significantly in the last ten years, so that "It is clear that such a blossoming relationship needs to be embedded in a robust governance framework to sustain it, to make it grow further and to guard against potential hiccups." "We have learned from the great crisis" Tran said, "that the larger the investment and lending flows, the greater the need for transparency for governments, the private sector, private investors and consumers to make decisions correctly."
For his part, the President of the US Association of the Club of Rome, Francesco Stipo, said that "globalization creates several issues that need to be regulated by an international organization because a single nation cannot regulate them by itself." Existing institutions such as the G20, do not have the ability to coordinate responses to global financial issues, according to Stipo, and therefore, "the solution is in the reform of the United Nations; to reflect the changes that have happened in the last 60 years, the organization should be better coordinated and centralized to face the global challenges of the new millenium."
The moderator of the first panel, Richard Bernal, Advisor to the Executive Director for the Caribbean of the Inter-American Development Bank (IDB), highlighted the common thread in the presentations of Dookeran, Stipo, and Tran, who concurred that "there is an urgent need for some type of governance structure that is coherent, comprehensive, and transparent and allow all countries to participate in a way that reflects their economic weight."
The second session of the event focused on “Sustainable Development, Capital Markets and Debt Management in the Western Hemisphere” and was moderated by the Managing Director of Plantation International, Rodrigo Valderrama, who encouraged the panelists to present their perspectives and experiences on promoting global investments, and how the various corporate bodies, NGOs and governments promote and analyze investment in the countries of the region.
The Executive Director of the Bertelsmann Foundation, Annette Heuser, focused her presentation on the analysis of the European crisis and how this could affect the financial stability of Latin American countries. "If the European crisis continues, subsidies from European banks may be affected," she said, referring especially to French banks that fund transactions in the region. She also spoke about the BRIC economies (Brazil, Russia, India and China) that seek to create their own development system, including their own bank to finance development projects and initiatives, "which indicates that they want to be more independent of the prevailing currency, which is the US dollar."
For his part, the President and Chief Executive Officer of the Real Estate Roundtable, Jeffrey DeBoer, noted that real state markets are key to sustainable economic growth, which makes it especially necessary to create public policies that encourage and support future investment in this sector. "In this globalized world, foreign capital is very important, that is why it is necessary to encourage foreign investment," he said, and spoke specifically of policies that can promote such investment, including proper management of tax barriers and the need to build confidence, create an environment of predictability and certainty for foreign investment.
Finally, the Senior Expert on Risk from McKensey & Company, Zane Williams, spoke about the processes and best practices in the management of large-scale investments, relating them to issues such as market diversification, uncertainty and the effectiveness of capital allocations. He also shared experiences on how to measure the risks in times of uncertainty and in countries and regions that have not traditionally been recipients of foreign investment in the past.
A gallery of photos of the event is available here.
The B-roll of the event will be available here.
For more information, please visit the OAS Website at www.oas.org.