The Importance of Multilateralism in the Twenty-First Century

The globalization of the past half century (and even earlier) has enabled the ascent from poverty of billions, and improved the quality of life of many more. The gains in terms of health, life expectancy, literacy are taken for granted. Further gains from globalization are within grasp for many more. But successful globalization has depended in part on the ability of the multilateral institutions, especially the International Monetary Fund and the World Trade Organization, to underpin the smooth functioning of the international trading system and the international monetary system. Indeed, strengthening these institutions is even more desirable than in the past because of increased interdependence. The recent financial crisis has shown many ways in which the system needs strengthening and support. Yet, to date, the commitment of countries’ governments to the multilateral system seems to have been weakening. It is crucial for future growth that that trend be reversed and that the open multilateral trading system and the international financial arrangements be strengthened.