The International Response to the Global Crisis and the Reform of the International Financial and Aid Architecture

The financial crisis which began in 2008 has taken its toll on the “real economy”, causing a record drop in trade and sharp rises in unemployment across the world. The effects on all countries are dramatic and the impact is particularly harsh on developing countries who cannot afford the fiscal stimulus packages being deployed in Europe and North America. To this end, the leaders of the G-20 agreed on a series of measures to help the poorest countries of the world. The study by Professor Woods analyses the measures taken so far by the international community to address the impact of the economic crisis in developing countries, as well as the appropriateness of the IFIs (IMF, World Bank, and others) to implement such measures. The G20 expressed a clear aspiration to ensure that the poorest of the world are not the most severely affected by the crisis in the short-term as well as in terms of impacts on their long-term development. To foreshadow the conclusion, the analysis in this paper highlights that there are some urgent actions which need taking if this aspiration is to be met and that the EU is well-placed to lead on this.