Showing papers in "Global Governance in 2009"

The G-20 and International Economic Governance: Hegemony, Collectivism, or Both?

Abstract: Following the East Asian crisis of 1997-1998, much attention was paid to financial sector reform. While little of substance has changed in the intervening years, a number of potentially important new forums were established to facilitate international cooperation. By drawing on and modifying theories of hegemony, this article provides a theoretical context within which to explore one of these institutions: the Group of 20 (G-20). The key question examined is whether institutions like the G-20 are likely to provide genuine mechanisms for cooperation and inclusion or simply become instruments of "hegemonic incorporation." The argument here is that despite the continuing "structural" dominance of the international system by the United States and the Group of 7 (G7) nations, the G-20 provides some scope for other nations to influence outcomes.

Information and Communication Technologies for Development: A Critical Perspective

Abstract: For more or less a decade now, the issue of Information and Communication Technologies for Development (ICT4D) has been high on the global policy agenda. The efforts of the Global Knowledge Partnership (GKP), which was established in 1997 as a multistakeholder network to promote ICT4D, have more recently been reinforced by, among others, the World Summit on the Information Society (WSIS), a two-phase summit that took place in Geneva in December 2003 and in Tunis in November 2005. The WSIS has accelerated public-private ICT partnerships among UN agencies, governments, corporations, and civil society organizations. ICT4D's main tenet--the assumption that the development, diffusion, and implementation of information and communication technologies (ICTs) will bring prosperity and wealth--resounds forcefully in the wider public sphere also. (1) But while critical appraisals of this development paradigm do exist, "there is little if any evidence of reasoned debate about the politics of these technologies in the forums in which decisions are taken." (2) This article attempts to publicize some of the critical remarks on ICT4D that tend to be marginalized in the global policy arena. Taking a critical stance by no means entails ascribing conspiracy features to ICT4D. On the contrary, I am aware that ICT4D activists, whether in government, academia, civil society, or even business, are usually driven by the best of intentions. But the fact that people and institutions are devoting important efforts and resources to the realization of ICT4D projects should not in itself be taken as evidence that the ICT4D approach is unproblematic. All technological innovations, from the optical telegraph over underwater cable to radio and television, have in their times been hailed because of their "promise of universal concord, decentralised democracy, social justice and general prosperity" but subsequently also failed in terms of delivering more development. (3) In this regard, it is instructive to pay attention to the well-documented fact that the post-World War II modernization paradigm also mobilized a host of well-intentioned people and institutions that devoted lots of resources to modern communication for more than two decades but with disappointing results, as even modernization's proponents had to admit. (4) The idea was that access to and availability of radio and television would provide people with the information needed to change their behavior in order to realize economic growth. I am not arguing that history repeats itself, but merely stressing the fact that it is worrying that ICT4D generally does not display awareness of and critical reflection on more than sixty years of communication and development. However, I believe it should be possible to go against the grain serenely by pointing to the fact that the bulk of the ICT4D discourse does not question the assumption that ICTs necessarily stimulate economic growth and combat poverty. ICT4D advocates assume that technologies are autonomous forces or independent variables causing change in every domain of human life. In so doing, they gloss over the fact that socioeconomic, cultural, political, and institutional factors are also shaping "history" and that technology is affected at least as much by these factors as it is an influence on them. (5) ICT4D's argument that poor people and developing countries should have access to the newest technologies lest the digital age bypass them seems plausible. To put into perspective this belief in technology as a neutral tool and as a means to leapfrog, it is useful to look at critical political economy strands in communication studies. From Herbert Schiller and Dallas Smythe onward, (6) political economists have explicitly contested the fact that technology is neutral and have forcefully called for the examination of crucial matters of control, cost, selection, and utilization. To focus exclusively on the fact that technology has changed neglects the fact that the political-economic dynamic has not. …

Deliberative equality and the transgovernmental politics of the global financial architecture

Abstract: Revisiting the concept of transgovernmentalism, originally developed by Robert Keohane and Joseph Nye, can shed considerable light on the nature of interstate cooperation in contemporary global financial governance. Transgovernmentalism highlights how certain technocratic policy communities, composed of finance ministries, central banks, and regulators, dominate the global financial architecture. It also provides insights into the political and social basis of these actors' interactions and deliberations. Most importantly, renovating the concept of transgovernmentalism brings the participatory deficits in the current global financial architecture into sharp focus and points us in the direction of a workable reform agenda that would expand inclusion and participation. This article advocates basing future reform on efforts to achieve a closer realization of the principle of "deliberative equality." Unfortunately, "transgovernmentalism" is incompatible with deliberative equality, meaning that it is precisely the transgovernmental characteristics of the current global financial architecture that have to be challenged and overturned if we are to arrive at anything approximating deliberative equality. KEYWORDS: global financial architecture, transgovernmental politics, G7, G-20, deliberation. ********** Over thirty years ago, Robert Keohane and Joseph Nye published a seminal article in the journal World Politics that outlined the concept of transgovernmental relations. (1) In the intervening period, political scientists have rarely applied the concept in empirical research, fewer still sought to revise it for the contemporary era. In this article, I make the argument that a renovated version of the concept of transgovernmentalism can make a significant contribution to our understanding of the political dynamics of the current global financial architecture (GFA). (2) As a concept, transgovernmentalism not only reveals much about the nature of interstate cooperation in contemporary global financial governance, but also brings the participatory deficits in the current GFA into sharp focus and points in the direction of a modest, workable reform agenda that would increase inclusion and participation. The review of the GFA undertaken after the Asian financial crisis involved three distinct trends. There was both a partial privatization of financial governance evident in the creation of twelve codes and standards that were designed to enhance market scrutiny of national policies and practices (3) and a limited shift away from the "club" model of diplomacy evident in the creation of the G-20, which challenged the monopoly of leading developed countries. Most significantly, the architectural exercise consolidated and deepened the transgovemmental characteristics of the GFA. The transgovernmental nature of the GFA restricts participation in key deliberative spaces to a limited number of regulators and central state agencies (almost exclusively finance ministries, central banks, and specialist regulatory agencies), which dominate and control the deliberations that determine the terms and content of global financial governance, resulting in a narrow, technocratic, closed insider policy process that remains largely impenetrable to a wider range of concerned societal interests. While there is some evidence of a shift in global governance arrangements toward a more polycentric form of "complex multilateralism" in which various civil society groupings, nonstate actors, and developing countries participate alongside more traditional advanced capitalist state bureaucracies in the form of trisectoral networks, (4) I argue in this article that the principal defect of the global financial architecture is that it remains insufficiently pluralist and that this is a direct result of its overriding transgovernmental character. I begin with a brief discussion of the growing significance of the concept of deliberation for the study of global governance, including some consideration of the importance of the issues of participation and representation in the act of deliberation. …

Emerging International Human Rights Norms for Transnational Corporations

Abstract: This article analyzes the emergence of new human rights norms for transnational corporations. It first explores voluntary norm-making approaches, which have been a staple of this issue area since the 1970s. Second, it analyzes the formulation and eventual fall of the UN Draft Norms on the Responsibilities of Transnational Corporations and Other Business Enterprises with Regard to Human Rights. A final section reflects on the work of the UN special representative of the secretary-general on business and human rights, John Ruggie, and the future of norm making in this area. It is argued that these three processes constitute differing but fundamental steps toward the construction of international human rights norms for corporations and that, although norm entrepreneurs have clashed in debates over voluntary versus binding standards, norm making in this area remains healthy thanks to a now more solid international awareness regarding the corporate responsibility toward human rights.

Global Norms Through Global Deliberation? Reflections on the World Commission on Dams

Abstract: In recent years, global “deliberative processes” bringing together government, civil society, and private sector actors have become increasingly common on the global stage. Past work on these processes has either read them as relatively unproblematic consensus-building exercises, or exercises in global corporatism. Using a case study of the World Commission on Dams, this article explores how formal global deliberative processes can be a strategy for global norm formation and legitimation. It suggests that global deliberation can indeed be a vehicle for emergence and propagation of norms, but that these processes face multiple challenges that are structural in nature. Three factors are identified as key elements in understanding norm emergence through global deliberation: the legitimacy of global deliberation linked to questions of representation and democratic procedure; the micropolitics of norm emergence; and the process through which incipient norms are institutionalized by states.

Multisectoralism, Participation, and Stakeholder Effectiveness: Increasing the Role of Nonstate Actors in the Global Fund to Fight AIDS, Tuberculosis, and Malaria

Abstract: During the past ten years there has been an increased willingness by international health organizations to include multisectoral nonstate actors in their decisionmaking processes. The stated aim of expanding multi-sectoral involvement is to increase information flows from those on the ground, to create a sense of policy ownership by those implementing various health programs, to create a more unified front against global health priorities, and to create a more robust sense of institutional legitimacy. One such institution has been the Global Fund to Fight AIDS, Tuberculosis and Malaria, which was designed specifically to bring various stakeholders together to create a more coordinated mechanism to combat three of the world's most destructive diseases. The purpose of this essay is to discuss the role of nonstate actors in the decisionmaking processes of the Global Fund. The aim of this discussion is not to undermine the good work of the Global Fund, but to expose certain structural weaknesses in the current way nonstate actors are incorporated into the governance process and to illustrate how these structural processes might negate their effective participation. By doing so, this exploration will help expose various deficit gaps between the stated aims of multisectoral participation within the Global Fund and its actual practice. The goal is to encourage normative recommendations for increasing the real-world operation of stakeholder inclusiveness, ownership, partnership, and participation within the Global Fund. The Global Fund and Its Multisectoral Foundations To get a sense of the multisectoral dimension of the Global Fund, it is useful to outline some of the reasons why the Global Fund was established and to highlight the guiding principles that underwrite its mandate. The foundations for the Global Fund were laid at a G8 summit in Okinawa, Japan, in the year 2000. From that meeting, the G8 leaders acknowledged the need to create a new global health partnership to respond to increasing global health priorities. Linking effectiveness to inclusive multisectoral participation, the G8 leaders claimed that "only through sustained action and coherent international cooperation to fully mobilize new and existing medical, technical and financial resources, can we strengthen health delivery systems and reach beyond traditional approaches." (1) As was further exclaimed, the "participation of developing country partners and other stakeholders will be essential." (2) By linking policy effectiveness to inclusive participation, five existing failures in multilateral global health governance were recognized. First, it was a widely held belief that there was a general lack of local expertise involved in global health governance and the decisionmaking process. Because of this, it was believed that global health governance failed to fully capture conditions on the ground and did not adequately reflect the particular constraints and conditions that were involved in each recipient country. Second, because of this lack of participatory input, it was felt that current global health policies lacked a sense of local ownership and that this often diminished the political will to follow through on implementation. Third, many donor countries maintained that there was a lack of institutional accountability measures within the existing United Nations system and that this acted as a disincentive for them to provide financial assistance. Fourth, it was believed that the current United Nations system had become overly political and diffident, so that effective global health policy and implementation could no longer be efficiently channeled through that body. Last, it was unanimously agreed that there was no unified and collective resource stream to fund global health priorities and that AIDS, tuberculosis, and malaria could be effectively managed only through a system of multisectoral cooperation, multisectoral dialogue, and a commitment to an internationally coordinated response. …

Critical Mass as an Alternative Framework for Multilateral Trade Negotiations

Abstract: The article posits that, over time, the sense of the World Trade Organization's so-called Single Undertaking has been perverted, and that the current interpretation requiring every WTO member to be obligated by all new Doha Round agreements is a major problem in the stalled negotiations. The authors' preliminary research supports the idea of conducting international trade negotiations in agriculture on the basis of a critical mass framework, where only those WTO members accounting for some nominated major percentage of trade would take on new obligations. The article recounts how this approach has worked before in the General Agreement on Tariffs and Trade (GATT) and the WTO, and suggests areas of further research in order to test the proposition with respect to agricultural trade. KEYWORDS: international negotiations, trade. World Trade Organization, agriculture, political economy. ********** The outcome of the Uruguay Round of multilateral trade negotiations contributed significantly to strengthening and unifying the international trading system. The World Trade Organization (WTO) and the so-called Single Undertaking of its members, wherein all are party to all WTO agreements, participate equally in decisionmaking, and safeguard their rights under a strong central dispute settlement system, is a unique and invaluable institution that is essential to the effective governance of the global economy. The continuing success of the system depends on the WTO being able to show that it can effectively discharge its three principal roles of overseeing the implementation of the trading rules (via multilateral surveillance of the committees and councils overseeing the agreements, the various transparency obligations embedded in those agreements, and the Trade Policy Review Mechanism, or TPRM), settling disputes among members, and serving as a forum for negotiation of new and improved rules and increased trade liberalization. At the time of this writing, the Doha Round of multilateral trade negotiations is in serious trouble. (1) The negotiators are years late in achieving the targets set out for themselves in the November 2001 declaration. In our view, a large part of the problem relates to the process and to the fact that a decision made in November 2001 to treat ''the conduct, conclusion and entry into force of the outcome of the negotiations as parts of a single undertaking" (2) has been accepted by participants as meaning that all WTO members must be involved in and obligated by the outcomes in all areas of the negotiations. Given the economic diversity of the WTO's membership and the history of the organization, it makes little sense to expect the Single Undertaking approach to negotiations as it is currently understood to produce good outcomes. Even more important, such an approach does not need to be pursued in order to achieve an outcome with meaningful benefits for the global economy. In fact, insistence on the Single Undertaking approach will likely produce an inferior result in the Doha Round--if a result can ever be achieved on this basis. The problems with the current approach to the negotiations are particularly acute in the case of trade in agriculture--the sector universally regarded as the most significant element of the Doha Round. In this article, we outline a hypothesis that an alternative framework for international trade negotiations for agricultural products may be likely to produce better outcomes for agriculture and for future trade negotiations more generally. The argument of this article is as follows: 1. The WTO's Single Undertaking is valuable to the extent that it improves the adherence of developing and (especially) developed country members to all of the agreements. 2. But the Single Undertaking did not eliminate the contradictory treatment of reciprocal trade liberalization by the General Agreement on Tariffs and Trade (GATT). …

The Paradox of Multilateral Organizations Engaging with Faith-based Organizations

Abstract: Multilateral organizations, such as the World Health Organization, have traditionally not closely engaged with faith-based organizations. However, more recently, there has been a growing willingness among MOs to engage with FBOs. Factors promoting this engagement have included the rise of economic neoliberalism and participatory paradigms, a realization that FBOs may enhance program effectiveness, and a need for greater cooperation to respond to HIV/AIDS. At the same time, paradoxically, engagement with FBOs conflicts with the Enlightenment ideology on which most MOs are based. This ideology has traditionally espoused secularism and relegated faith to the private domain. To reconcile this paradox, MOs have often imposed conditions requiring FBOs to remove faith activities from their programs. This potentially compromises the unique cultural identity of the FBO.

Reregulation and Fragmentation in International Financial Governance

Abstract: Every global financial crisis generates new regulatory responses. What kinds of responses are emerging so far from the crisis that began in 2007? How are these responses similar to or different from those that followed the last major crisis of 1997-1998? Arguably this crisis marks an important turning point in the governance of international financial markets. Not only is there a significant reregulation of international financial markets by the leading Western governments, but the crisis is also unleashing centrifugal pressures that may lead toward a more decentralized and fragmented form of international financial governance over the medium term. The G7's Push for Reregulation The world is clearly changing when top international bankers announce the kind of intellectual conversion that the chief executive of Deutsche Bank, Joseph Ackerman, did in March 2008. "I no longer believe in the market's self-healing power," he announced. A few weeks later it was the turn of the influential columnist of the Financial Times of London Martin Wolf to declare that the rescue of Bear Stearns marked the day when "the dream of global free-market capitalism died." (1) By September, political leaders such as French president Nicolas Sarkozy were echoing this message. "Self-regulation is finished," he proclaimed, "Laissez faire is finished. The all-powerful market that is always right is finished." (2) These dramatic statements highlight the seriousness of the current global financial crisis. But they also reveal how different its political implications are from the last global financial meltdown a decade ago. In 1997-1998, global financial markets were severely shaken by a series of crises emanating from developing countries. Policymakers in the G7 countries largely attributed those crises to mistakes in government policy. The afflicted countries had borrowed excessively and had to be encouraged to exercise greater discipline. Their financial regulatory and supervisory practices were deemed to be inadequate and to require improvement to meet international standards, particularly Anglo-American standards. G7 officials even blamed themselves for encouraging excessive risk taking in international financial markets through their backing of ever larger IMF rescue packages. At the core of these views was the belief that global financial markets themselves were not to blame for the crises. This trust in the markets was also reflected in G7 decisions in the subsequent decade to assign an increasing range of regulatory functions to private financial actors such as banks, credit rating agencies, and accountants. (3) As the preceding quotations make clear, the political dynamics associated with the current crisis could not be more different within the G7 countries. There is a strong consensus that the same market actors who were previously assigned important regulatory roles have been key culprits in triggering the current crisis. Private financial institutions and markets have been particularly criticized for their failure to recognize the risks involved in various market innovations associated with new models of securitization. Sub-prime mortgage loans were transformed into securities, which were then bundled and sliced up into tradable portfolios with distinct risk profiles. As credit risk was transferred and traded to parties far removed from the original source, its quality became more obscure and was consistently under-priced by credit rating agencies and other institutions. Once the crisis broke out, the far-flung diffusion of subprime mortgages also intensified the erosion of confidence because of widespread uncertainties about who actually held these products and what their levels of exposure were. Particularly opaque were the over-the-counter (OTC) derivative markets, including the enormous market for credit default swaps. Here private actors (predominantly highly leveraged hedge funds) engaged in private bilateral deals without a formal clearinghouse or exchange that could minimize counterparty risk and force margin requirements for all contracts. …

An End to Global Standards and Codes

Abstract: In the wake of financial crises in the 1990s, the International Monetary Fund (IMF) and G7 officials, along with private sector financial actors, launched an effort to develop and promulgate a set of standards and codes to govern global finance. While this effort has witnessed some success during the past decade, it also has hit many stumbling blocks. The current capital markets crisis may undermine the US-led effort to impose a universal set of standards on developing countries. The Global Standards Effort One of the lynchpins of attempts at financial regulation during the past decade has been an effort by G7 governments (particularly the United States) as well as international financial institutions (IFIs) to create a set of global financial standards. These standards aim to govern a range of areas, including the provision of macroeconomic data, the regulation of national securities exchanges, and the promulgation of international norms for accounting. The main impetus for the standards project was the financial crises of the mid- and late 1990s. Policymakers in the developed world ascribed the crises largely to problems of information, transparency, and corruption in emerging markets (1) rather than to any sort of inherent market instability. On this diagnosis, the solution was to continue capital account liberalization in developing countries but to couple this liberalization with an attention to regulation in a "sequencing" approach. (2) As part of the G7's effort, the Financial Stability Forum (FSF) was established in 1999. The FSF serves as a coordinating body for a dozen "key codes and standards." While the FSF seeks to apply its standards to the universe of countries, it operates according to a club-oriented process. (3) The FSF consists of G7 governments (three seats per country, one each for the finance ministry, the central bank, and the financial regulator); international financial institutions (seven seats total for the IMF, the World Bank, the Bank for International Settlements [BIS], the Organisation for Economic Co-operation and Development [OECD], and the European Central Bank [ECB]); international regulatory bodies (six seats total for organizations focused on banking regulation, securities regulation, accounting standards, and insurance supervision); central bank expert committees (two seats); and single seats for the governments of Australia, Hong Kong, the Netherlands, Singapore, and Switzerland. This "network of networks" (4) advances standards for financial sector operations (banking, securities); market integrity (money laundering, accounting); and transparency (data dissemination, fiscal and monetary policymaking). Some of the standards (bank regulation, money laundering, data dissemination) were based on efforts that existed previously. In other instances, the FSF has been the primary forum for developing rules, often coordinating the efforts of private, quasi-governmental, and governmental organizations. Governments of both developed and developing countries were encouraged to adopt these standards, usually mimicking practices based in major financial centers. The new standards required not only changes in government policies vis-a-vis external actors (e.g., reduced barriers to investments from abroad), but also changes in domestic policies (e.g., accounting practices of firms and banking sector regulation). Another distinguishing feature of the new standards is the mix of public and private authority involved. (5) While the precise nature of regulation and supervision varies across the twelve standards and codes, there is significant reliance on the private sector. In some cases, private financial actors help to enforce the rules. In other cases, such as accounting and auditing, the private actors were active in the development of standards. In still other instances, such as the Basel II accords, private actors both provided input to construct the rules and helped to implement them. …

Global Public Goods: Critique of a UN Discourse

Abstract: The concept of global public goods has been advanced as a way of understanding certain transborder and global problems and the need for a coordinated international response. It has been used to describe everything from global environment, international financial stability, and market efficiency, to health, knowledge, peace and security, and humanitarian rights. Using an internal critique, this article finds that the concept is poorly defined, avoids analytical problems by resorting to abstraction, and masks the incoherence of its two central characteristics. The conclusion is that even if the concept of global public goods is effective rhetorically, precise definition and conceptual disaggregation are required to advance analysis of global issues.

Why International Institutions Matter in the Global Credit Crisis

Abstract: The global dimensions of the credit crisis of 2008 have become increasingly apparent. Bank failures, credit freeze-ups, and sharp stock market declines have spread well beyond the borders of the United States, the original epicenter of the crisis. What role, then, should international regulatory institutions play in addressing the crisis? Much public discussion of the crisis has underestimated the relevance of such international institutions, often assuming that they do not exist, or that they are so weak that we will have to relay to rely on nation-states for any meaningful response. In contrast, I argue in this article that a relatively well-established set of existing international institutions should and will play a central role in response to the crisis. (1) However, I also argue that policy makers, regulators, and financial elites have displayed too much complacency and self-interest in their attitudes toward these institutions, and these failings need to be corrected with greater public awareness and pressure regarding the role that these institutions can play. To see the potential of existing international institutions to address the current credit crisis, it is necessary to go beyond the assumption that only states or formal intergovernmental organizations can have influence. Faced with extraordinary complexity, including the need to manage the negative effects of fast-paced global markets, public authorities have increasingly shifted from centralized "command and control" to rely more on hybrid mixes of decentralized public and private regulation, a phenomenon that has been called "regulatory capitalism." (2) A risk in this shift is that policy and regulatory processes will be captured and manipulated by the private sector actors that they are supposed to regulate. However, such capture is not inevitable, especially if mechanisms for asserting the public interest in these processes are strengthened. Transnational Private Sector Institutions in Global Finance While the financial products involved in the present crisis are often seen as toxic, mysterious, and chaotic, they also signify an increase in the institutionalization of global financial markets. The current crisis is the first transnational one involving personal credit. There are direct linkages between individual borrowers and global financial markets, in which creditors and investors are much more widely dispersed than previously. Such connections have been enabled by the growth of a variety of now well-established transnational practices, institutions, clearing houses, and networks that transmit information, calculate risk, record contractual commitments, and transfer ownership claims. This institutionalization involves inertia, benefits, and sunk costs for the participants that will make transnational financial practices difficult to abandon. At the same time, this institutionalization can also provide opportunities for public and private authorities to strengthen the governance of global finance. In the financial sector, as elsewhere, commercial firms may use their trade associations to propose self-regulatory arrangements as an alternative to public regulation. Such practices are very well established domestically and are becoming more evident in global finance as well. For example, the CEOs of leading international banks forestalled effective public regulation of hedge funds at the time of the 1998 Long-Term Capital Management (LTCM) crisis by organizing themselves into the Counterparty Risk Management Policy Group (CRMPG) and creating best practices. Ironically, this group's second major initiative, the CRMPG II report of 2005, predicted a number of the key elements of the current crisis, but evidently without significant effect. The influence of CRMPG I and II was undoubtedly enhanced by the reputation of the chair, E. Gerald Corrigan, managing director at Goldman Sachs and formerly head of the New York Federal Reserve and chair of the Basel Committee on Banking Supervision. …

Supranational Citizenship Building and the United Nations: Is the UN Engaged in a "Citizenization" Process?

Abstract: The citizenship concept is not absent from UN discourse. However, the use of the term is limited to a conception of citizenship systematically associated to the state; terms such as supranational citizenship or UN citizenship are not part of the usual UN vocabulary. Does that mean that the UN is not “making citizenship” at all? The answer seems obviously positive. Considering the history of the European Union and work on European citizenship, this article demonstrates that such a response may be too hasty. Through the analysis of two institution-building processes—the creation of supranational criminal courts and the opening of UN policymaking processes—it is argued here that just as the European Union was making citizenship well before the Maastricht Treaty explicitly mentioned “European citizenship,” the United Nations is beginning to engage a process of citizenization.

Introduction: The Future of the Multilateral Trade System—What Role for the World Trade Organization?

Abstract: Global governance through multilateral institutions has fallen on hard times in the twenty-first century. Whereas intergovernmental multilateralism was the dominant form of international collective action in the second half of the twentieth century, today international cooperation through multilateral institutions is facing severe challenges. Over the past five years or so, contributors to Global Governance have grappled with these difficulties, particularly in relation to the problems confronting the World Bank, the International Monetary Fund (IMF), and the United Nations and its associated bodies. This special issue seeks to contribute to these ongoing debates through an examination of the World Trade Organization (WTO) and the future of the multilateral trade system. The articles in this issue appear at a particularly important time in the future of the governance of the global economy more generally. As we come to the end of the first decade of the twenty-first century, we live in a period of acute economic crisis--by common agreement, the worst since the Great Depression of the 1930s. The attention of global leaders is focused on providing the necessary fiscal stimuli to reboot the world's major economies and securing the necessary level of global institutional reform to both underwrite and regulate the global banking system. But the WTO is under duress. Its problems were identifiable prior to the eruption of the financial crisis, but they have been exacerbated by the current crisis as much as they are part of the current crisis--notwithstanding that, for once, no one thinks that trade is a contributory factor. The dramatic problems in the financial sector are accompanied by a dramatic decline in cross-border trade; indeed, the first such decline since 1982. This has affected all of the world's major economic powers including the wealthy countries of the Organisation for Economic Co-operation and Development (OECD) and the emerging economies, including Brazil, Russia, India, and China (BRIC). In 2008, global trade grew by 2 percent in volume, but the WTO expects it to fall by 9 percent in 2009--the biggest contraction in trade since World War II. (1) Whereas most members of the WTO appear to have kept the worst domestic protectionist pressures under control, there is growing evidence of countries adopting, or threatening to adopt, trade-restricting or trade-distorting measures to protect key national business and jobs. Since the beginning of the financial crisis, governments have enacted scores of trade-restricting measures, including tariff increases, new import licensing requirements and new agricultural export subsides. Antidumping cases are also on the increase and bailouts to car and automotive component manufacturers in many countries can also have a trade-distorting effect. (2) These activities have taken place across a range of countries including the United States, the members of the European Union (EU), China, Russia, India, Indonesia, and Argentina. The financial crisis also inhibits trade expansion through the negative effects of reduced liquidity on access to and sharp increases in the cost of trade credit for exporters. This problem is particularly acute for developing country exporters. The cost of trade credit has tripled in the six months between the November 2008 and April 2009 G-20 summits. (3) For some scholars and practitioners, the current financial crisis questions the utility of the WTO in addressing its elements. While recognizing the primacy of the financial crisis, the articles in this special issue resist the assertion of irrelevance. Rather, we would suggest that the financial crisis throws into sharp relief some of the issues that the WTO needs to address if it is to remain relevant in the twenty-first century. Specifically, are WTO rules sufficient to withstand the pressures for retaliation that will ensue if domestic protectionist policies are enacted? This is particularly important given the increasingly hidden or murky nature of much contemporary protectionism. …

Regime Interplay in Public-Private Governance: Taking Stock of the Relationship Between the Paris Club and Private Creditors Between 1982 and 2005

Abstract: Despite new interest in the implications of growing institutional density for international cooperation, and in so-called public private governance, the interplay between public and private regimes has so far been largely overlooked. This article draws on the emerging literature on parallel regimes in international governance to analyze the evolution of the norms and rules governing sovereign debt restructuring from the early 1980s to the mid-2000s, with a particular focus on the interplay between those covering official bilateral (or Paris Club) debt, and those dealing with private credits. It shows how, from the mid-1990s onward, changes in market and political environments turned burden sharing between bilateral and private creditors into a contentious issue, partly undermining the existing framework for public-private cooperation, and confirms that a focus on institutional interplay can help identify some of the key dynamics behind public-private cooperation. Keywords: parallel regimes, institutional interplay, public-private governance, sovereign debt restructuring, Paris Club. ********** Acknowledging the multiplication of international agreements and norms, scholars have begun to question the implications of growing institutional density for international cooperation. (1) Concepts such as regime overlap, nesting, or regime complex have been developed to attempt to account for the phenomenon, and explore its consequences. Yet while the interplay between state-led regimes has attracted rising scholarly attention, that between private regimes, or between state and private regimes, has remained virgin territory, despite early calls for a thorough analysis. (2) In light of the growing interest in issues relating to public-private governance, the fact that the interaction between state and nonstate sets of principles, norms, and rules has largely been overlooked seems especially puzzling. One reason might be the lack of a clear line between state and nonstate. Virginia Haufler identifies a private regime "as one in which co-operation among private actors is institutionalized, and in which states do not participate in formulating the principles, norms, rules or procedures which govern the regime members' behaviour." (3) However, private regimes, like their exclusively state-led counterparts, are best seen as one end of a continuum along which the proportion of state and private influence varies. In some areas, regimes are created by states on private foundations (e.g., human rights); in others, regimes are established by private actors under the watchful eye of the state (e.g., maritime insurance or Internet access). In yet others, state and private actors share in the definition, implementation, and monitoring of norms and rules (e.g., intellectual property rights or the Basel II framework). Yet when focusing on the two ends of the continuum (i.e., contrasting primarily state-led and primarily private-led institutional arrangements), important differences emerge that may influence institutional design and evolution. In particular, whereas market actors are primarily accountable to their shareholders and investors and therefore must obey commercial imperatives, state actors are subject to electoral accountability and their decisions tend to reflect geopolitical considerations and domestic political pressures. How these differences impact the interplay between public and private regimes, creating synergy or conflict, is thus of major interest. Drawing on the emerging literature on parallel regimes in international governance, I analyze the evolution of the bilateral and private regimes for sovereign debt restructuring from the early 1980s to the mid-2000s, with a particular focus on the interplay between the two. As will be shown below, the existence of different sets of norms and practices governing official bilateral and commercial debt first attracted scholarly interest in the 1980s, with the Latin American debt crisis. …

Special Forum: Crisis and the Future of Global Financial Governance

Abstract: Financial crises often act as a catalyst for important changes in global financial governance. We are currently living through such a crisis, one that is in fact the worst since the Great Depression. And true to historical pattern, it is generating very heated debates about the regulation of global financial markets. This special forum examines the politics of international regulatory responses to the present global financial crisis. What holes has the crisis revealed in international financial regulation? In what ways are regulators trying to fill those holes? Does the current crisis represent some kind of historic turning point in international financial regulation, as many are predicting? Will the regulatory response primarily rely on national institutions or on transnational ones? Four leading scholars of the politics of international financial regulation address these questions in the contributions that follow. Each brings a distinctive perspective to the issue. Tony Porter thinks that significant transnational regulatory initiatives have already begun and will continue to advance in the context of increasingly dense and sophisticated global institutional frameworks, including private ones. In contrast, Layna Mosley argues that the crisis, far from strengthening global cooperation, is likely to undermine the universalistic ambitions of the Western-led project—growing out of the East Asian crisis of 1997–1998—to impose global financial standards and codes on developing countries. I suggest in my contribution that the crisis is generating a reassertion of state authority over international financial markets, albeit in ways that may unleash centrifugal pressures that lead toward a more decentralized global regulatory environment. Finally, David Singer is skeptical that the crisis, despite its severity, will lead to much significant change at all in the global financial regulatory regime because of the fragmentation of regulatory accountability within the United States. c

Strengthening the Governance of the International Monetary Fund: How a Dual Board Structure Could Raise the Effectiveness and Legitimacy of a Key Global Institution

Abstract: he ongoing financial crisis and a difficult international adjustment process involve a multitude of actors and forums They all grapple with I the complexities of a globalized economic and financial system and the challenges arising from the financial turmoil and economic downturn Gov ernments have responded with unilateral, bilateral, or regional actions Major central banks have cooperated on an ad hoc basis, and the G7 and the G-20 have attempted to provide economic stewardship But the considerable spillovers and policy interdependence in a globalized economy that were already visible in the run-up to the turmoil have shown that the international monetary and financial system needs an effective steering committee to address such spill overs and facilitate cooperation on global economic matters For decades, the International Monetary Fund (IMF) was at the helm of the international monetary system However, an alleged unequal treatment of its mem bers, an ever expanding mandate diluting its core responsibilities, complacency in its policy advice, and the dominance of its governance by some large countries have more and more sidelined the IMF in the international policy debate While the actions by the G7 may have been sufficient to address economic shocks in the past, the emergence of new economic players in Latin America, Eastern Europe, and Asia necessitates a fresh look at how to address global economic challenges, which involve a rising number of systemically important players The IMF has realized that it risks being sidelined in global economic af fairs and is now in its fourth year of a strategic review of its setup and activi ties, with the declared objective of regaining its position as the "steward of international financial cooperation and stability" and putting itself firmly at the center of the international monetary system Progress is under way: The IMF is strengthening its surveillance by deepening the analysis of interlinkages, including exchange rates, in its bilateral economic surveillance It is placing

Revitalizing Global Environmental Governance for Climate Change

Abstract: Whether the December 2009 negotiations in Copenhagen produce "success" or real success (1)--that is to say, merely a foundation for further negotiations or a full-blown new post-Kyoto Protocol climate change agreement--the world seems headed for a period of extraordinary international environmental activity with implications for every nation, community, business, and individual on the planet. The scale, complexity, and potential cost of responding to the threat of climate change make this a policy challenge of unprecedented proportions. And it is becoming increasingly clear that the worldwide effort to reduce greenhouse gas emissions and mitigate the threat of global warming and related problems, including changed rainfall patterns, melting polar ice, sea-level rise, and increased intensity of windstorms, will not be successful without significant institutional support at the global scale. The existing global environmental governance system, centered on the UN Environment Programme (UNEP) in Nairobi, is by almost all accounts not up to the task of managing the response to climate change. UNEP suffers from a vague mandate, severe budget constraints, limited analytic capacity, and other human resource challenges as well as a lack of political support. UNEP has a record of success in some respects, notably in shepherding the process that led to the Montreal Protocol and a series of subsequent amendments that helped phase out chlorofluorocarbons (CFCs) and other chemicals that threatened the world's protective ozone layer. But in recent years, UNEP has not been a major player on climate change. Indeed, fragmentation is one of the fundamental problems of our current regime of global environmental governance. Dozens of organizations have some degree of environmental responsibility, including the UN Commission on Sustainable Development, UN Development Programme (UNDP), the World Bank and other multilateral development banks, and numerous environmental treaty secretariats. But these various entities often do not "play" well together. There has been little attempt to set consistent priorities, achieve a systematic division of labor, rationalize budgets, or pursue synergies across issues. Moreover, there has been little policy coordination between global-scale economic decisionmaking and parallel efforts at worldwide environmental protection. A successful global response to climate change will therefore require broad-scale revitalization of the global environmental governance regime. (2) In fact, the urgent need for strengthened environmental cooperation across the world in response to climate change offers an opportunity to rethink global governance more broadly. In this regard, now may be the time to launch a Global Environmental Organization (GEO), based on a new international organization model. Rather than a ramped-up UNEP, I envision a GEO that is leaner and more focused, and which subsumes existing environmental treaty secretariats and consolidates within it the UN Commission on Sustainable Development. It would have a small permanent staff in Geneva and a substantial virtual presence, drawing in expertise from around the world in an evolving set of global public policy networks. To be effective, the new international organization would need clear goals, a compelling set of core principles, carefully specified functions and capacities, and a strong commitment to "good governance." Goals Any reform of the global environmental governance structure needs to emphasize effectiveness, efficiency, and equity. These goals seem straightforward, yet past international environmental policy cooperation efforts have fallen short on all three of these elements. With a few notable exceptions (such as the Montreal Protocol), the existing regime has produced many meetings and some agreements, but few concrete improvements in environmental performance. Principles Successful international organizations have clear guiding principles. …

Aid for Trade and the “Missing Middle” of the World Trade Organization

Abstract: As part of the Doha Development Agenda, many members of the World Trade Organization and, in particular, its director-general have actively promoted the so-called Aid for Trade initiative. Rather than offer a comprehensive account of this initiative, the purpose here is to consider its implications for proposals to fill in the WTO's “missing middle,” that is, for suggestions to develop the WTO's non-negotiating, nonjuridical, deliberative functions.

Nonstate Actors in the International Legal Order: The Israeli-Hezbollah Conflict and the Law of Self-Defense

Abstract: The concern of whether nonstate actors can undertake an “armed attack” that would trigger a state's right to self-defense has acquired new prominence in the post–September 11 world. This article addresses that concern by examining the Israeli-Hezbollah conflict of July 2006. It argues that since the US invasion of Afghanistan in 2001, states have incurred an increased responsibility for the acts of nonstate actors that operate from their territory. Based on this emerging norm, the argument is that the degree of Lebanon's involvement in Hezbollah's attack against Israel was sufficient to justify the use of force in self-defense by Israel against both Hezbollah and the state of Lebanon. The conclusion is that while this is a potentially dangerous development in international law, there is reason to suggest that it may actually encourage states to prevent their territory from being used by nonstate actors to export violence.

Process Drivers in Trade Negotiations: The Role of Research in the Path to Grounding and Contextualizing

Abstract: Virtually every country today is either already a member of or seeking to accede to the World Trade Organization (WTO). (1) Numbers make a difference, but so does the intellectual landscape in which newcomers operate. Ideas in trade relations have become so dominant that they are invisibly embedded as a "normal" way of doing business. Reproduced in a spiral of precedents, they can then remain largely unquestioned and taken for granted, playing a subtle background role in shaping and limiting the articulation of policy alternatives. As such, ideas can serve to conceal the stratification of the global system into a core of rule makers and a broad band of heterogeneous rule takers. Institutions thus emerge as embedding the preferences and interests of some constituencies better than others. Since the WTO ministerial meeting in Cancun in 2003, there are two particular developments that characterize the participation of rule-taking developing countries in the WTO. (2) First, they are learning to participate more effectively through coalitions. Evidence of this can be found in the ever-growing numbers of such coalitions and their resilience. For instance, the Cancun meeting catalyzed the emergence of at least four new coalitions--the G-20, (3) the G-33, the Core Group on Singapore Issues, and the Cotton Group--in addition to the activism of others that predated the ministerial, including the African, Caribbean and Pacific Group; the Least Developed Countries Group; the Africa Group; and the Like-Minded Group. Several of these remain active and continue to bargain collectively in the Doha Round. Bargaining based on a coalition provides countries both weight and resources (including research) to balance the agenda. Second, the quality of developing country proposals has improved significantly in terms of range, depth, and feasibility, demonstrating substantive research and mastery of technical detail. Indeed, some participants present the production and exchange of research as core functions of the coalition itself. Research intensity has grown exponentially. No doubt as contending players grow in strength and stature, they are investing in the production of research to become technically empowered. After all, trade negotiations are about who gets what and how. What is the nature of this trade-related research that is of growing relevance in rule-taking developing countries? Research can contribute to the definition of interests, and identification of policy problems and preferred solutions, especially in their capacity to posit causal relationships. My aim here is to advance analysis of how research is produced in the management of trade negotiations by the developing countries that have established themselves as relevant process drivers (4) in the WTO. The Emergence of Process Drivers Clearly the intensity of research has not emerged from thin air. The incorporation of the "Single Undertaking"--emerging from the Uruguay Round--meant that all member countries were required to comply with the entire set of rules within the WTO. More flexible arrangements for opting in or out of particular agreements within the overall package were all but eliminated. All countries had to accept normal responsibilities and diffuse degrees of reciprocal bargains. This represented a major turning point in the participation and representation of developing countries, who had shed their mostly defensive positions and thus were showing a new willingness to take on full-fledged commitments. Their strategic dilemma turned from expanding their rights to free themselves from prevailing rules to choosing an appropriate strategy of participation that focused on what commitments to make and on how to micro-manage a bloated trade agenda. The challenges of inclusion soon proved to be highly demanding. Developing countries learned that greater participation did not automatically translate into leverage when they found it difficult to decisively influence the process of agenda setting or to shape the final outcome of negotiations. …

Operationalizing Special and Differential Treatment in the World Trade Organization: Game Over?

Abstract: The notion of providing special and differential treatment to developing countries has a long history in the World Trade Organization, but some commentators continue to question its rationale and practical effectiveness in supporting development and integration into the multilateral trading system. In particular, while operationalizing special and differential treatment is one of the important tasks of negotiators in the ongoing Doha Round, some argue that this will not only be difficult, but in fact impossible to achieve. Doubtless, special and differential treatment cannot of itself solve the problems of the developing world, and relying too heavily on this kind of discrimination will ultimately disadvantage developing country WTO members. Nevertheless, in achieving a successful conclusion to the Doha Round, members must take greater account of the different needs of developing countries and adopt more concrete provisions in this regard than are currently contained in the Uruguay Round agreements. In general, WTO members themselves appear to have accepted this responsibility, despite the slow progress in this as in many other areas of the negotiations. Ideally, this process should involve in-depth economic analysis to identify measurable criteria for granting special and differential treatment to particular countries under specific provisions. If these criteria can be agreed and incorporated into the WTO agreements, no new independent bodies will be required to assess individual cases separate from the established WTO dispute settlement system. KEYWORDS: World Trade Organization, developing countries, international trade, international law, multilateral negotiations. ********** As the Doha Round drags on, many are looking with increasing skepticism at its Development Agenda, concerned that even a successful end to the negotiations will be no more development-friendly than was the Uruguay Round before it. That round concluded with the successful creation of the World Trade Organization (WTO) in 1995. But since then, it has become clearer that developed countries fared better in the final outcome, with fewer disciplines imposed in areas critical to developing countries, such as agriculture and textiles, and more in areas traditionally the province of developed countries, such as intellectual property. From the time that the Doha Round commenced in 2001, many WTO members, commentators, and non-governmental organizations (NGOs) have called for greater emphasis on special and differential treatment for developing countries in the WTO in order to improve support for development and rebalance the playing field. In particular, these voices insist that the existing special and differential treatment provisions in WTO law must be operationalized. Indeed, the ministerial declaration that launched the Doha Round specifically mandated a review of all special and differential treatment provisions "with a view to strengthening them and making them more precise, effective and operational." (1) Special and differential treatment sounds, on first hearing, like an ideal solution to developing countries' difficulties in meeting their peoples' needs, complying with WTO law, and competing in the global market. However, do developing countries need more special differential treatment or less? And is the WTO the right forum for addressing development concerns? Michael Finger (formerly lead economist at the World Bank) recently described the attempt to operationalize special and differential treatment as "heartfelt but ill-defined and ultimately fruitless," declaring that the WTO members' work in this regard in the Doha Round has unsurprisingly "c[o]me to nothing." (2) He has since queried whether the WTO has anything useful to do in this area. (3) This highlights the complexities and limitations of special and differential treatment. …

The Subprime Accountability Deficit and the Obstacles of International Standards Setting

Abstract: Today's financial crisis has triggered some of the largest bank failures in history, including Washington Mutual and Fortis, as well as substantial instability throughout US, European, and Asian banking markets. Bank failures around the globe will likely continue as housing markets collapse and credit markets dry up. Indeed, the crisis may get much worse. As of mid-2008, the US Federal Deposit Insurance Corporation (FDIC) has identified more than 100 banks on its "troubled bank" list, and European regulators are struggling to contain the fallout of the crisis in their respective domestic markets. Central banks have created ad hoc swap arrangements to ease international liquidity problems, and they have recently slashed interest rates in an unusual exercise of international coordination. However, the important question for global governance is whether the financial crisis will prompt a serious international effort to change the rules of domestic and global banking. Despite the galvanizing effect that the financial crisis appears to be having on central bankers, the prospects for new international regulatory standards are fairly gloomy. The key problem is that US regulators are unlikely to champion new international standards. There are two main reasons for this assessment: first, the myriad proximate and underlying causes of the crisis; and, second, the considerable fragmentation of domestic financial regulation in the United States. Without US leadership, any modifications to the international standards and guidelines created by the Basel Committee, the International Organization of Securities Commissions (IOSCO), the International Association of Insurance Supervisors, or the Joint Forum will likely be cosmetic rather than substantive. (1) While little may happen internationally, the most significant regulatory response to the financial crisis may be within the United States. The US Treasury's regulatory blueprint recommends the organizational consolidation of domestic financial regulation, including the dissolution of the Office of Thrift Supervision and the creation of a federal insurance regulator. The consolidation of US regulatory agencies might facilitate international regulatory harmonization in the long term simply by reducing the transaction costs of international negotiation and clarifying agency accountability. Global Banking Standards: Learning from the Past In the recent past, bank instability in the United States and the United Kingdom prompted both governments to press for new international financial regulation. A quick review of the 1980s may help to shed light on the prospects for a similar international response to the current financial crisis. For this period, the focus is limited to commercial banks and their regulators. Savings and loan institutions are not considered, as they were peripheral to the development of international standards. US leadership on global standards for the prudential management of banks had its roots in the 1980s banking crisis. As US commercial banks began to falter in the early 1980s, domestic regulators responded quickly by tightening capital requirements. (2) However, their increasingly stringent regulations were not able to stem the tide of bank failures. A total of 468 commercial banks failed between 1985 and 1987, more than in the previous thirty years. (3) By the mid-1980s, regulators felt extraordinary pressure to tighten regulations further. Yet regulators also faced a rising competitive threat from Japanese banks, which faced less stringent capital rules. (4) The rise of the Japanese banking sector created an environment in which US regulators were hard pressed to maintain stability without harming bank profitability. It was precisely this environment that led US regulators to press for an international standard on capital adequacy. In short, US leadership on global regulation emerged from the specific domestic challenges of financial regulators. …

Climate Change: Governance Challenges for Copenhagen

Abstract: Climate change has been described as "a diabolical policy problem ... harder than any other issue of high importance that has come before our polity in living memory." (1) To deal with it effectively involves many different policy areas. These include not only the obvious ones like energy, but also others such as macroeconomic and fiscal policy, food security, health, water, trade, biodiversity, and even immigration. The financial implications of climate change--impacts, adaptation, and mitigation--are huge and growing. There is a need for massive deployment of technology, a sector notoriously difficult to regulate. Climate change also involves time frames unknown in public policy. There is currently no overall governance arrangement to integrate all these dimensions. The Bonn-based UN Framework Convention on Climate Change (UNFCCC) secretariat, with its mandate defined by the existing convention and the Kyoto Protocol, can easily be seen as too narrow in scope and expertise, and too small to cope with the scale and complexity of this global challenge. It is often pointed out that the international institutional framework is sectorally based, whereas climate change is inherently a cross-sectoral issue. Another weakness is that the Annex I/non-Annex I distinction on which the convention, the protocol, and, to a large extent, the negotiations under the Bali Road Map are based has outlived its usefulness. The Bali Road Map negotiations have softened this distinction a little by referring to developed and developing countries, but even this cannot adequately reflect the range of responsibilities and capabilities among countries. By 2050, the horizon we need to work toward if the world is to come to grips with global warming forty-two years after the start of the Kyoto Protocol's first commitment period, the evolution of the world's major economies will have rendered these dualities irrelevant. There is also much concern about the lack of effectiveness and efficiency of some of the existing institutions, as can be seen by the criticism directed at the Global Environment Facility (GEF) by developing countries, and by concerns about aspects of the Clean Development Mechanism, which had been voiced in the negotiations. If new institutions were to be formed, therefore, they almost certainly would not replicate the current arrangements. Indeed, the same could be said of sustainable development in general; (2) advocacy of new and stronger governance arrangements is widespread, with some opinion favoring a new world environment organization under UN auspices as the way forward. The core challenge of mitigation, or emissions reduction, would ideally be addressed first by the small number of countries that represent 80 percent of global emissions, represented in the Major Economies Forum (MEF), a sort of climate G-20, rather than through the UN process where close to 200 countries need to be corralled into agreement. After all, the action taken by fewer than twenty countries will determine whether or not global greenhouse gas concentrations can be limited to 450 parts per million [CO.sub.2] equivalent or lower, so that there is an even chance of limiting global warming to 2 degrees above preindustrial levels. The G8 has given useful impetus to global action on climate change, but its role is limited because it is not sufficiently representative of the developing economies. If the MEF did not already exist, inevitably a similar grouping would have emerged sooner or later. This is not to say that a MEF-brokered agreement on reducing global emissions would be enough in itself. The small, the poor, and the vulnerable, who represent numerically by far the largest number of countries, are in a position to demand that their needs be catered to in any future climate agreement. In particular, no agreement can afford to overlook a large-scale response on adaptation for these countries that have contributed little to global emissions and now find themselves at the forefront of expected impacts of climate change. …

"Walking Together" Toward Independence? A Civil Society Perspective on the United Nations Administration in East Timor, 1999-2002

Abstract: Issues surrounding legitimacy and the role of civil society are at the forefront of contemporary global governance debates. Examining the United Nations Transitional Administration in East Timor (UNTAET) and focusing on the specific issue areas of justice and gender, this article evaluates the effectiveness and accountability of the administration from the perspective of East Timorese civil society, whose voice is largely absent from previous analyses. Drawing on the archive of the prominent civil society group La'o Hamutuk. this study adds precision and nuance to an area of research characterized by broad-stroke assessments of the legitimacy of multinational interventions. It finds variations in the levels of overall legitimacy exhibited by particular issue areas and differences in terms of the configuration of accountability and effectiveness enjoyed by UNTAET. Although sounding a cautionary note about the degree of civil society influence in global governance, the study concludes that La'o Hamutuk nevertheless provided a more diffuse sense of discursive voice and accountability than would otherwise have been accorded the East Timorese during this crucial period in their history.

A Role for Legislators

Abstract: We are living in a world that is facing multiple global challenges: the economic downturn, climate change, energy security, poverty, and ecosystem breakdown. Each of these challenges requires an unprecedented political response, a daunting prospect when viewed together. Our main difficulty is not that these challenges are insoluble--they are not. Instead, it is the fact that we are facing these modern-day challenges while using institutional frameworks and governmental structures that were designed for a post-World War II equilibrium. The existing international bodies responsible for tackling these current challenges are separate, disparate, and not sufficiently "joined up." We have the Group of 20 (G-20), the International Monetary Fund, and World Bank for the financial crisis; the UN Framework Convention on Climate Change (UNFCCC), G8, and Major Economies Forum for climate change; the International Energy Agency (IEA), and G8 for energy security; the UN Development Programme and World Bank for poverty; and the UN Convention on Biological Diversity for ecosystems. Each of these organizations is doing important work, but many are working with considerable constraint on issues that require a unified policy response. As a result, we have disconnected institutions responding to an interconnected world. An Interconnected World The interconnections between countries, regions, economies, and cultures are multiplying. Within national governments, the interconnections between policies across portfolios of energy, environment, transport, security, and foreign policy are increasing. Indeed, the recent financial crisis is a perfect illustration, beginning with the irresponsible lending of money to private homeowners in the United States and leading to a near global financial meltdown. This inter-connectedness has resulted in increased unemployment, increased national debt, reduced trade, and exacerbated poverty, which have reduced the ambition to tackle climate change. The current crisis has shown us, quite clearly, how a national or regional economic downturn can quickly and easily turn global and demand policy responses across a range of geographical and ministerial disciplines. It serves as a warning that responses to the biggest global environmental challenges such as climate change or ecosystem loss cannot be tackled by environment ministers in isolation, but instead require enlightened policy interventions across the full range of ministerial portfolios from energy to economics and from finance to transport. Fundamentally, we require continued political leadership from the top of government, without which there is little hope of achieving meaningful solutions. Global Responses Meeting global challenges successfully will require unprecedented global coordination across the major economies. National and regional action is part of the solution, but to be successful, the right institutions and global governance structures will be needed in combination with political leadership from the major economies. We have limped along over the past twenty to thirty years with institutions designed for a postwar world that are slow to respond and increasingly out of alignment with the challenges of the day. In parallel, on global governance, the G8 group of industrialized countries is increasingly being questioned as the political constellation best placed to deal with global issues. The debate around institutions and global governance is not new, but has been given political impetus by the comments of Brazilian president Luiz Inacio Lula da Silva who, when referring to the G-20 summit in Washington, DC, in 2008, said: "We are talking about the G20 because the G8 doesn't have any more reason to exist; emerging economies have to be taken into consideration in today's globalised world." (1) Many observers see the move away from the G8 and toward the G-20 as inevitable. As the former UK G8 Sherpa to Tony Blair in 2005 and 2006, Lord Michael Jay, who was also the architect of the Glen-eagles G8 summit, said: "It is hugely significant that at a time of global financial crisis it was the G20 that met in Washington and not the G8. …