Jessica Honggo (University of Southern California)
The issue raised in Soesastro's article "East Asia, the G20 and Global Economic Governance" is one among the many issues that are being raised regarding the management and governance of international institutions. There has over and over again been felt that a bias exists in representation towards the governance of these institutions with the developed world assuming the lion share, leaving the developing and third world countries voiceless. The G20 has in its part come to reshape the global economic governance. According to Soesastro, therefore, the G20 forum represents a golden opportunity for the voiceless to raise their concerns and grievances and probably edge closer towards solving the challenges facing world economies. In doing this the East Asian members must make a steadfast move and take a more pro-active role in the forum. He is more to the opinion that a global solution to the current crisis has to be crafted collectively through new looking global economic governance based on representative institutions. The first step in achieving this would have been to reform global institutions to reflect changing economic weight of the emerging economies towards the global economy. This would be achieved through regional or sub-regional arrangements. The other steps would be on supervision of these new looking global institutions. Soesastro is opposed to one overarching and complete organization being given the authorization to overlook these institutions but somewhat suggests establishment of regional arrangements networks to perform the task. Each region will send its own regional representatives who will adopt a common voice on issues affecting them and have a common ground of suggested solutions or priorities ensuring none of the economies are left behind in crafting solutions.
I strongly agree with Soesastro's critical opinion on the existing international institutions. Governance is one issue among many hindering these institutions deliver to the mandate which they were formed to fulfill. Whether we like it or not, the world is increasingly becoming a global economy and such has been proved by the current economic crisis. It does not matter where the crisis did emerge, who caused it or whether one had any role in advancing it or preventing, all economies have been affected by the crisis.
Here is why I would then support the call for reforms in the governance of these institutions. Some years back the international community embarked on an ambitious mission they christened the millennium development goals (MDG's) of which each and every country did commit to enhance and help others achieve the targets set. International organizations have their stake in assisting countries to achieve these goals but they have not been effective enough. For example, the IMF has the mandate to assist developing countries through lending to acquire the relevant capital for growth. The institution has however been made to assume the role of the last resort lender due to the stringent macroeconomic conditions set to be fulfilled before advancing credit. Most of the countries are shying away borrowing from this institution even when they have a need, a problem that has partly been created by the G8 having substantial control on the institution. Ensuring improved governance is the surest way to bolster these institutions in delivering their mandate and hence enable economies achieve their targeted MDG's. Poverty is by so far the biggest hurdle towards achieving these targets. In this regard, developed countries did commit themselves to helping their poorer countries counter parts eliminate this through aids and grants. As the developed countries are the donors and the poor and developing countries are the donor recipients, all of them require to have their voice heard in the decision making process for these institutions. Good governance entails that all stakeholders get their rightful chance to raise their voices and concerns. This will serve to provide key information needed for better decision making from both ends.
Another point on governance in the article that I agree with is regional representation. A closer look at the different regions reveals that, countries that do share a common region are in most cases facing the same economic situations. Whereas it would not be feasible to have every country send its own delegation to represent it in these institutions, regional representation will do the trick for balanced representation. As noted in the article, over-arching bodies would not offer the best solution on the problem. This is because, despite an over-arching body such as the UN having allowed certain selective councils voice their diverse interests and opinions in the UN Security Council, it has at other times been conceived as illegitimate and impartial. Other measures that enhance fair regional representation on global governance should be considered. In addition, regional representation forums can act as the launching grounds for more integration which has been held to enhance economic growth through trade and investment within and across regions in the global economy, where technology could more easily be transferred from developed and technologically advanced countries to developing countries in order to achieve sustainable growth in the global economy.
As Soesastro states in his article, there is an urgent and pressing need that international organizations be based on fair regional representation. In this regard, East Asia should be ready and willing to participate and raise its voice in world forums such as the G20 if the opportunity arises. In order to enhance fair representation, East Asian cities such as Beijing or Tokyo should be considered hosting future G20 meetings, but this is upon the concerted efforts of East Asian countries to press for it. Furthermore, efforts should be made by East Asia to move to a more desirable position by itself in terms of both regional integration and global governance. In more general terms, good governance in international institutions would mean a greater role to be assumed by developing countries which are becoming increasingly important, vis-à-vis developed countries, in the global economy. It must be noted that effective solutions to global problems are only tenable if all the stakeholders feel equally represented.