The third lesson is that international financial institutions can be of
some help - when not driven by political or geopolitical considerations
and when not married to a dogma. Unfortunately, these are the rare
cases. Most IFIs - notably the IMF and, to a lesser extent, the World
Bank - are both politicized and doctrinaire. It is only lately and
following the recent mega-crisis in Asia, that IFIs began to "reinvent"
themselves, their doctrines and their recipes. This added conceptual
and theoretical flexibility led to better results. It is always better
to tailor a solution to the needs of the client. Perhaps this should be
the biggest evolutionary step:
That IFIs will cease to regard the countries and governments within
their remit as inefficient and corrupt beggars, in constant need of
financial infusions. Rather they should regard these countries as
CLIENTS, customers in need of service. After all, this, exactly, is the
essence of the free market - and it is from IFIs that such countries
should learn the ways of the free market.
In broad outline, there are two types of emerging solutions. One type
is market oriented - and the other, interventionist. The first type
calls for free markets, specially designed financial instruments (see
the example of the Brady bonds) and a global "laissez faire"
environment to solve the issue of financial crises.
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