The workings of the contemporary international financial architecture

Abstract

Purpose: in this article, the author analyses acute issues of the contemporary international financial architecture (IFA), its stability and international financial markets’ regulation. Discussion: аs the International Monetary Fund (IMF) plays a key role in the system of international finance, the author delivers a critical analysis of its activities aimed at the IFA’s stabilization in 2008-2015, and on this basis he proposes recommendations on its reform. The author also outlays the specifics of the IMF issuing new financial assistance projects and concludes that the latter does not take an important part, does not prevail over traditional instruments and does not bring an expected result. Results: the author identified the shortcomings of the IMF’s activities in 2008-2015, which translates as follows: the financial assistance was supplied only to a very specific range of target-countries, i.e. it did not have a universal, global character, and for the majority of member states it was not sufficient to deal with the crisis. Many countries do not support such policies. Therefore the author proposes an alternative, compromising approach to the IFA’s reform which is driven by the BRICS. At the same time the author proves that the IFA’s reform today does not presuppose a radial, far-reaching character. Contrary to that it will take quite a long period of time during which the BRICS will take more solid positions in the contemporary IFA, and their national currencies (the Chinese Yuan in particular) will become international in scope as soon as they go through the internationalization process.