Financial Diplomacy Key to Building Global Economy
By MacKenzie C. Babb
Staff Writer
Washington - Cultivating common ground among financial leaders around the
world will be critical to effectively facing 21st-century economic challenges,
says Treasury Under Secretary for International Affairs Lael Brainard.
"Economic decisions made in one country have an outsized impact on jobs and
growth here in the United States and around the world," Brainard said June 25 in
remarks to the Women's Foreign Policy Group in Washington. The under secretary
encouraged more women to become involved in financial diplomacy and said the
field is growing in importance, thanks to globalization.
She said that in an increasingly interconnected world, a single country's
domestic policies can affect the economies of countries around the globe as much
as an international treaty.
"By determining whether currencies and stock markets plunge or stabilize,
[financial diplomacy] can make the difference in whether families can afford to
send their children to college, buy a home or retire comfortably," she said.
"Convincing leaders of other countries to change their domestic economic
policies can be challenging and intensely political, yet it is essential" when
the policies have a significant impact on the international community, Brainard
said.
"And while classic diplomacy moves through the synapses of foreign
ministries, financial diplomacy navigates through finance ministries and central
banks, directly connecting the decisionmakers that determine tax and fiscal
operations, reserve management and debt issuance," she said. "Through frequent
interactions and similar responsibilities, financial diplomats develop a common
set of tools, analytics and language."
Brainard said developing and maintaining this common vision for diplomacy
has been the key to effectively cooperating during tough economic times.
"More often than not, crisis is the crucible that forges the innovations
with the most lasting impact," she said, referring to action taken by the Group
of 20 advanced economies to change international financial resources and
institutions in response to the global economic crisis in 2009.
She commended the steps taken that year by international leaders to
mobilize $1 trillion through the World Bank and International Monetary Fund in
order to boost global demand, enhance trade flows and build up international
economic confidence.
Brainard said that at the G20 summit in Los Cabos, Mexico, earlier in June,
leaders addressed the challenges facing Europe's economic recovery.
"The decisions that lie ahead for the leaders of euro area member states
will have a profound impact not only on their economies but also on their
political future," she said, adding that while the decisions are for European
leaders to make, the outcomes "matter profoundly" to the rest of the
world.
She said European leaders are committed to "take all necessary measures to
safeguard the integrity and stability of the euro area, to improve the
functioning of the financial markets and to break the feedback loop between
banks and sovereigns."
Brainard said the United States and its partners are committed to
supporting Europe as it navigates its recovery.
The G20 leaders said in a statement that the group "will work collectively
to strengthen demand and restore confidence with a view to support growth and
foster financial stability in order to create high-quality job opportunities for
all our citizens." They announced a new, coordinated Los Cabos Growth and Jobs
Action Plan to achieve those goals.
"Despite the challenges we all face domestically, we have agreed that
multilateralism is of even greater importance in the current climate, and
remains our best asset to resolve the global economy's difficulties," the June
19 statement said.
The G20 is scheduled to hold its 2013 summit in St. Petersburg under the
chairmanship of Russia.
(This is a product of the Bureau of International Information Programs,
U.S. Department of State.)
No comments:
Post a Comment