Transcript Sudan - debt apportionment and reduction: Steps, options

THE FINANCIAL STABILITY
BOARD:
WHY SHOULD CSOs CARE ?
Matthew Martin, Development Finance International
Washington, 15 April 2011
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STRUCTURE OF PRESENTATION
• What is FSB and how does it work ?
• What are its subsidiary bodies and
who does what ?
• Why should CSOs care ?
• Suggestions on Ways Forward
2
WHAT IS THE FSB?
• Financial Stability Board (FSB) established post-crisis by
G20 – promoted from analytical body to coordinating
and decisionmaking body on all financial regulation
• Does not have power to enforce regulations in
member jurisdictions – rather to set standards,
exchange on best practices, try to standardise across
jurisdictions and monitor their implementation
• Members = G20 + important financial countries
(HK/Singapore/Switz/Neths/Spain), but 11 have 3
seats, 6x2, 3x1 - LIC G20 members not admitted
• Agreed at Seoul on « Regional Consultative Groups » not clear if genuine consultation or dissemination,
which countries to participate
3
FORMAL FSB STRUCTURE
• Key Actors:
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Chair of FSB Mario Draghi (Bank of Italy)
Secretariat of >20 people (Sec-Gen Sven Andriessen) in Basel
Plenary meeting of all members - decisionmaking 2x pa
Operates through committees and working groups on key
issues, made up of only some members
• FSB reports to G20, most work from G20 mandates to
deliver for future meetings, on some issues via Finance
Ministers/CB Governors, on others direct to summit
• No (?) engagement with UN (even IMF and WB do) –
supposed to bring developing country views ?
• Does not report to or engage with Development
Working Group (issues deliberately separated even
though FSB decisions affect all countries)
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ORGANIGRAM
G20
FSB Chair
FSB Plenary
Committees
and Working Groups
Affiliated
Organisations
FSB Secretariat
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HOW DOES IT OPERATE ?
• Key actors are Chair, Secretariat and Working Groups,
as well as mandates given to FSB by G20 itself
• Plenary seen as largely rubber-stamp, committees and
working groups do the technical work
• Lack of formal procedures means Chair has strong
power – can generate G20 mandates, influence WG or
Committee member choice and recommendations
• Some degree of uncertainty/overlap with IMF – eg IMF
handling public debt issues (FSB private ?), publishing
lots of analysis on bank regulation and taxation; and
with continuing role of BIS (still regulation committee)
• IMF helps dev.countries implement bank regulations;
IMF/WB now gathering dev country views on
regulations; some FSB affiliates help LICs implement 6
KEY FSB SUBSIDIARIES
1.
International Accounting Standards Board (IASB)
– accounting standards
2. International Organisation of Securities Commissions (IOSCO)
– securities market transactions - shares, bonds, derivatives
3. Bank for International Settlements (BIS) – Basel Committee on
Banking Supervision (BCBS)
– regulation of banks
4. Also IAIS - Insurance and IADI – Deposit Protection
•
Common features
– often high presence of private sector;
– no openness to wider civil society or media;
– little or no presence of poorer countries (except
BCBS)
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WHY SHOULD WE CARE (1) ?
1. On issue of principle:
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We have spent last 20 years fighting for
accountability and transparency in IMF and WB
with some success
This is the third pillar of the global economic
governance system (fourth if incl WTO) and in the
stone age on accountability and transparency
There is currently no access whatsoever for civil
society and media therefore regulations are being
decided by governments only, advised in many
cases by private sector actors who are being
regulated and their lobbyists
Also virtually no access for low-income countries
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WHY SHOULD WE CARE ? (2)
It covers key issues:
1. IASB
–
–
2.
accounting standards crucial to tax accounting/evasion, transfer
pricing etc – vital links to tax haven and tax justice campaigns
Bill Black – regulation will achieve nothing unless transparent
accounts – poor accounting caused Iceland, financial crisis, Enron
IOSCO
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3.
derivatives and commodity trades and shares/bonds – vital to food
and fuel price speculation and price trends
efforts to put all derivatives including commodities on markets –
could dramaticlly increase regulation of speculation
BCBS
–
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correct design of regulation to avoid future financial crises ?
application of regulations in developing countries can have major
effects on availability of bank lending, including on microfinance
and financial inclusion efforts
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CONCLUSION/NEXT STEPS
• Definitely not « Mostly Harmless » (Donnelly)
• Perceived as such by G8 governments because they mainly
determine global regulatory standards, and also by private
actors because regulations havent bitten much
• But crucial to key development issues which affect the
world’s poor citizens and on which CSOs focus campaigns
• Need for network to
– Open up the FSB – reform governance (Brookings
Commission); increase LIC membership; accountability
and transparency
– Advocate/share info/coordinate on specific issues
• Reminds me of debt relief 15 years ago – Jubilee decided
early needed to engage with institutions like Paris Club and
boring technicalities like cutoff dates - one of the key reasons
why >$100 billion cancelled !
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