As you mention 1944, it is important to remember that Bretton Woods, the IMF and the World Bank (and also the UN and the European Union) were created to prevent WW3. Towards the end of the 20th century, these aims had been not only abandoned but forgotten and, on occasion, ridiculed (for example in the UK when the EU was awarded the Nobel Peace Prize in 2012). Now, WW3 is more likely to happen ever since the Cuban Missile Crisis and we also have the climate crisis and the biodiversity crisis. I think it is really important, as you do, to revisit thinkers like Keynes today and to reconnect with their great aims and concerns. Thank you for your article.
1) Is the BIS a trustworthy institution? The third world hasn't had much luck with benevolence (or even neutrality) from global north/Euro/white institutions. Is the BIS really just a clearinghouse, or does it have other roles, alliances, obligations, agendas, and/or impacts?
2) Can you please spell out more how this financial arrangement would benefit climate -- mitigation? Adaptation? Both? Is it just about generating capital (in the hands of African states)? What are the steps to making an impact?
3) Are market mechanisms the way to go? We have such a history of false climate solutions marketed as "market-based" (meaning, "capitalist.") Is this similar? If not, how not?
I am no economist so really need plain answers to my naive questions. Thank you.
As to how this arrangement for the exchange of goods and services will benefit climate: African governments as much as richer, western governments, need to transform their economies and end dependence on fossil fuels. That costs money. Not just money, but goods and services - some of which are modern and far more energy efficient than older goods....The current globalised system, strips African governments of autonomy on these issues, and deprives them of finance. For example, some African govts are spending 40% of their budgets on repaying debts in foreign currency to much richer countries. Under the clearing system they would not have to do that...
Finally, the Clearing Union is not a market mechanism. It is an administered mechanism, one that is operated in a coordinated and harmonious way in the interests of the domestic economies of states; not the financial interests of foreign financial institutions...on Wall St. for example, or the IFIs in Washington.
The BIS is named here as a possible institution. But all institutions are constructed by humans, and are therefore prone to errors. But if we compare the role proposed for the BIS, to the role played by central banks, we can ask the question: why do we trust the Bank of England/the Federal Reserve/The ECB to manage the balances of private banks, and ensure that our deposits and withdrawals are properly accounted for? And is that trust justified by the outcomes?
...and African Liberation Day is May 25th. Exhortations from past years from the likes of Kumi Naidoo include to:
- Stop the bleeding (of resources, money)
- Use day to amplify your own work *and*
- Read aloud the Kilimanjaro Declaration. Then
- stand up together and say "we are Africans, and we are rising for justice, peace and dignity."
- Catch it on film (and share it).
--> Maybe there us a way for you to support ALD with this analysis.
Beautiful and comprehensive summary
Thank you for sharing. Flooding isn’t a joke
As you mention 1944, it is important to remember that Bretton Woods, the IMF and the World Bank (and also the UN and the European Union) were created to prevent WW3. Towards the end of the 20th century, these aims had been not only abandoned but forgotten and, on occasion, ridiculed (for example in the UK when the EU was awarded the Nobel Peace Prize in 2012). Now, WW3 is more likely to happen ever since the Cuban Missile Crisis and we also have the climate crisis and the biodiversity crisis. I think it is really important, as you do, to revisit thinkers like Keynes today and to reconnect with their great aims and concerns. Thank you for your article.
You're so right Alexander. Can only agree.
Africa's Zero Dollar Decolonial Climate Action Plan
https://youtu.be/zHovm6TZ0Z8?si=HY4eAzBUu7u7cMPO
Also
1) Is the BIS a trustworthy institution? The third world hasn't had much luck with benevolence (or even neutrality) from global north/Euro/white institutions. Is the BIS really just a clearinghouse, or does it have other roles, alliances, obligations, agendas, and/or impacts?
2) Can you please spell out more how this financial arrangement would benefit climate -- mitigation? Adaptation? Both? Is it just about generating capital (in the hands of African states)? What are the steps to making an impact?
3) Are market mechanisms the way to go? We have such a history of false climate solutions marketed as "market-based" (meaning, "capitalist.") Is this similar? If not, how not?
I am no economist so really need plain answers to my naive questions. Thank you.
As to how this arrangement for the exchange of goods and services will benefit climate: African governments as much as richer, western governments, need to transform their economies and end dependence on fossil fuels. That costs money. Not just money, but goods and services - some of which are modern and far more energy efficient than older goods....The current globalised system, strips African governments of autonomy on these issues, and deprives them of finance. For example, some African govts are spending 40% of their budgets on repaying debts in foreign currency to much richer countries. Under the clearing system they would not have to do that...
Finally, the Clearing Union is not a market mechanism. It is an administered mechanism, one that is operated in a coordinated and harmonious way in the interests of the domestic economies of states; not the financial interests of foreign financial institutions...on Wall St. for example, or the IFIs in Washington.
Thanks!
The BIS is named here as a possible institution. But all institutions are constructed by humans, and are therefore prone to errors. But if we compare the role proposed for the BIS, to the role played by central banks, we can ask the question: why do we trust the Bank of England/the Federal Reserve/The ECB to manage the balances of private banks, and ensure that our deposits and withdrawals are properly accounted for? And is that trust justified by the outcomes?