NIFA

Question 1

NIFA (New International Financial Architecture)

Answer 1

Core Idea:
Both iterations addressed the causes of financial crises, which were cause of poor government policies

Proposed Solutions:
Strengthen financial liberalization within the Post-Washington Consensus Regime (PWCR), emphasizing good governance, inclusive development, and participatory politics.

Question 1

Two NIFA iterations

Answer 1

NIFA I (1999): Developed as a response to the 1997 Asian financial crisis.

NIFA II (2009): Evolved following the 2008 global financial crisis.

Question 2

Assumptions Underlying NIFA

Answer 2

Financial liberalization (both Foreign Direct Investment (FDI) and Foreign Portfolio Investment (FPI)) is considered integral for economic growth and poverty reduction.

This perspective aligns with thinkers like Jagdish Bhagwati, the documentary The Crash, and Devesh Kapur.

Question 3

Mini-Regimes

Answer 3

The regulatory frameworks for financial liberalization are structured within the PWCR to manage the balance between private interests and public good.

Question 4

Key Elements of Good Governance in NIFA

Answer 4

1. Accountability and Transparency: Governments and corporations should publish key economic data.
2. Rule of Law: The adoption of soft or voluntary laws, such as codes and standards, to guide financial practices.
3. Anti-Corruption Measures: Improving corporate governance, particularly in family-owned businesses in the Global South.

Question 5

Tensions Identified in NIFA II

Answer 5

1. Persistent Poverty and Uneven Economic Growth
2. Rising Inequality
3. High public debt
4. Youth Unemployment and Underemployment

Question 6

Influence of the U.S. in NIFA

Answer 6

While the U.S. maintained considerable power in shaping NIFA, it was not the sole beneficiary of financial liberalization.