A new study from the United Nations University (UNU), an autonomous UN institution based in Tokyo, calls for an overhaul of international institutions. New Roles and Functions for the UN and the Bretton Woods Institutions criticises the Bretton Woods institutions for being undemocratic while failing to promote development. This is partly blamed on their ideology “which does not recognise the importance of public action in coping with market failure.” The study calls for greater transparency and public scrutiny of the IMF to make it accountable beyond just finance ministries and central banks. The World Bank also suffers from a “democracy deficit” according to the study, with “a very large proportion of the voting rights vested in a very small number of industrialised countries.” The Bank should “cease to be a moneylender and transform itself into an institution more concerned with development”. This would require a reorientation in its thinking.
The study also suggests the formation of an Economic Security Council and a Global Peoples Assembly. Modelled on the European Parliament, this would run parallel to the UN General Assembly and serve as the “voice of civil society”. The UN system should be modernised to take on more of the tasks that currently fall on institutions like the World Bank and IMF. “The world economy is much too complicated and interdependent for two or three specialised institutions to cope with,” argued Deepak Nayyar, UNU author of the study.
See the full report on UNU website
The study was undertaken by the World Institute for Development Economics Research (WIDER) with financial support from the Ministry for Foreign Affairs, Finland, and the United Nations Department of Economic and Social Affairs. The institute has published five working papers from the 1998-1999 Global Governance programme “New Roles”.