A Doomed IMF ‘Reform,’ or the New Silk Road?

July 17, 2019 (EIRNS)—France’s finance minister Bruno Le Maire said on Tuesday the post-war international monetary order needed to be reinvented or become increasingly dominated by China. “The pillars of that order have been the International Monetary Fund and its sister institution the World Bank, since their inception at the Bretton Woods conference in New Hampshire in July 1944,” he said, speaking at a conference at the French central bank marking the 75th anniversary of the Bretton Woods. “The Bretton Woods order as we know it has reached its limits,”

“The alternative we have is now clear,” he continued. “Either we reinvent Bretton Woods or it risks losing relevance and eventually disappearing,” he said, adding that while Bretton Woods had defined the international economic order of the second half of the 20th century, the first part of this century may be defined by China’s New Silk Road project. “Unless we are able to reinvent Bretton Woods, The New Silk Road might become the new world order,” Le Maire said. “And Chinese standards on state aid, on access to public procurements, on intellectual property could become the new global standards.”

Le Maire said the reform priorities of Bretton Woods institutions should be focused on fighting climate change, and that the arrival of a new IMF chief after Fund Director Christine Lagarde’s departure for the European Central Bank created an opportunity to rethink the fund’s mandate while its shareholders needed to ensure it had enough resources for the next crisis.