Since the signing of Jamaica Agreement, there has been no fundamental change in the international financial system. Because there is no global institutional arrangement on many basic issues, as some scholars have pointed out, the international financial system in the past 30 years is actually in a state of "no system". However, with the continuous improvement of international economic and financial integration, especially the rapid development of economic regionalization, some local changes have taken place in this system. Generally speaking, it includes the following basic features:
First, the international exchange rate system presents a basic pattern in which floating exchange rate arrangements and various exchange rate arrangements coexist. At present, there are three basic exchange rate arrangements in the world: one is an independent floating exchange rate arrangement, which is implemented by countries including the United States, the European Union, Japan and some emerging market economies; Second, fixed exchange rate arrangements, including countries that implement currency board system and traditional pegged exchange rate system, as well as countries that abolish legal tender (such as countries within the European Union and countries that implement dollarization); The third is the "middle way" arrangement, that is, various arrangements between floating exchange rate and fixed exchange rate, such as crawling peg system, interval floating system and management floating system, which mainly include some developing economies with high degree of extroversion or serious domestic inflation. According to statistics, in 2002, among the 186 member economies of the International Monetary Fund, 22%, 48% and 30% countries respectively implemented the above three types of exchange rate arrangements.
As the United States, Europe and Japan play an important role in the global economy, their floating arrangements are of decisive significance to the nature of the international exchange rate system. As far as a single country is concerned, the benefits of floating exchange rate arrangement are mainly reflected in maintaining the independence of monetary policy and automatically adjusting the imbalance of international payments to a certain extent. However, from the perspective of international financial stability, it contains at least two defects: first, frequent fluctuations in exchange rates will adversely affect normal international trade and investment activities, greatly increasing the exchange costs and risks of global economic activities; Second, it is easy to cause exchange rate policy conflicts, that is, using the depreciation policy of the local currency to promote trade expansion and safeguard domestic interests at the expense of other countries' interests. In the past two or three decades, although there has not been a global competitive currency devaluation as in the 1930s, local conflicts have occurred from time to time. 1997 The situation during the Asian financial crisis is a typical example. In industrialized countries, from the "Plaza Accord" that forced the yen to appreciate in the late 1980s to the strong dollar policy adjustment in the recent period, it fully shows that the United States relies on the exchange rate depreciation policy when alleviating the current account deficit.
The main significance of fixed exchange rate arrangement lies in the transfer of monetary sovereignty in whole or in part in exchange for the reduction of foreign exchange transaction costs and stronger domestic financial policy constraints. Various forms of "middle road" may combine the advantages of floating exchange rate and fixed exchange rate and give domestic monetary authorities discretion. However, in the case of frequent currency fluctuations in big countries such as the United States, Europe and Japan, both the fixed exchange rate and the "middle way" arrangement are actually facing severe tests. Many studies have shown that an important cause of the Asian financial crisis is the sharp appreciation of the US dollar against the Japanese yen after 1995, which caused the sharp appreciation of the currencies of countries pegged to the US dollar, such as Thailand, and seriously damaged the trade competitiveness of these countries.
Second, the international financial market plays an important role in the balance of payments adjustment. In the era of Bretton Woods system, due to strict financial control in various countries, the role of international financial market in the adjustment of international payments is relatively limited, and the adjustment of current account deficit in many countries mainly depends on fiscal and monetary policies. In the case of a serious deficit, we can also use the exchange rate policy in a limited way and get some short-term credit support from the IMF. However, since the 1970s, with the rapid development of international financial markets, countries can easily make up their current account deficits through commercial international financing, thus avoiding taking adjustment measures that may affect domestic economic stability, such as fiscal austerity. As a market-oriented arrangement, the existence of international financial market provides abundant international liquidity and greatly reduces the cost of balance of payments adjustment. But on the other hand, it has also produced new unstable factors. Most importantly, it makes some countries relax internal constraints, abuse fiscal expansion policies, and delay necessary domestic economic reforms and adjustments. As a result, not only the current account deficit eventually becomes uncontrollable, but also it often bears heavy foreign debts and even becomes the source of financial turmoil.
Third, the lack of effective supervision of international capital flows has become an important source of international financial instability. Since 1980s, with the continuous relaxation of capital controls in various countries, international capital flows have expanded rapidly. At present, the daily trading volume of various international capitals in the world has exceeded $65,438 +0.5 trillion. In recent years, many studies show that there are serious structural defects in the international capital market, and many international investment and credit decisions are made with insufficient information. In the choice of countries for capital flows, especially in developing countries, there is often a "hunger syndrome", that is, when some countries are optimistic about their economic growth prospects, international capital flows there on a large scale, and when these countries show signs of crisis due to excessive capital inflows, international capital quickly leaves. Therefore, it will often lead to internal and external economic imbalances in these countries, and eventually lead to monetary and financial turmoil. In addition, before and after the crisis, due to the lack of effective supervision, the participation of large-scale speculative short-term capital aggravated the crisis depth of the countries concerned and played a core role in the international transmission of the crisis.
Fourth, the functions of multilateral international financial institutions are seriously flawed and obviously unfair. The International Monetary Fund is the legacy of the Bretton Woods system. After 1973, the institution no longer has the power to restrict the exchange rate arrangements of countries. Its main function is to provide short-term credit to countries with balance of payments crisis and enhance their solvency. However, due to the serious shortage of long-term funds, the request for assistance to crisis countries is either slow or insufficient, and unrealistic conditions such as austerity and economic liberalization are often attached. In addition, as 1997 showed in the process of dealing with the Asian financial crisis, due to the obvious influence of the US government and Wall Street interest groups, the organization's request for assistance to crisis countries outside the United States often seems very indifferent. This shows the functional defects and unfairness of the organization in maintaining the stability of the international financial system.
Fifth, global monetary and financial cooperation has had little effect, and regional monetary integration has made remarkable progress. At present, the main channel of global monetary and financial cooperation is the meeting of seven heads of state and finance ministers. Generally speaking, this kind of coordination mechanism is often a mere formality and retreat, with little substantive content. In recent years, the International Monetary Fund and the Bank for International Settlements have also tried to play a more active role, but either the results are not significant or they are not really binding on countries. In contrast, the process of regional monetary cooperation has made remarkable progress. After decades of efforts, the euro was successfully launched on 1999, and a unified central bank and monetary policy framework has been established within the euro zone. It is worth noting that the birth of the euro has produced obvious demonstration effects. In recent years, in Latin America, Central and Eastern Europe and other regions, some countries have begun to adopt dollarization and currency board system, or to implement fixed exchange rate arrangements in the region. Although the financial crisis two years ago forced Argentina to abandon the currency board system, it did not seem to change this trend.
Sixth, the financial dominance of the US dollar remains basically unchanged, but it faces challenges. There has never been an independent world currency since mankind entered the era of credit currency standard. Therefore, international economic transactions have always relied on the currencies of a few sovereign countries as international means of payment and reserve assets. The dollar is the most important of these currencies. Since the establishment of the Bretton Woods system, with the help of the powerful economic and political power of the United States, the dollar has established global financial hegemony. For more than half a century, the share of US dollar in the international payment and reserve assets system has declined, but it is still as high as 60%. Relying on this position, the United States has obtained a large amount of "seigniorage" income, and can continuously occupy the actual economic resources of other countries by exporting dollars.
After the outbreak of the Asian financial crisis, the international academic community launched a heated discussion on the defects of the current international financial system, and put forward many positive reform suggestions and programs. Among them, the more influential suggestions include: strengthening monetary and financial cooperation among developed countries, establishing exchange rate target areas, and reducing exchange rate fluctuations among currencies of big countries; Strengthen the supervision of international capital flows, especially the restrictions on speculative capital flows (such as "Tobin tax", that is, countries levy taxes on foreign exchange transactions); Reform and reshape the IMF, enhance its financial strength, improve the transparency of loan decision-making, and increase the voting rights of developing countries in the IMF; Strengthen regional monetary and financial integration and so on. In addition, there are some radical suggestions, such as returning to the gold standard, restoring the Bretton Woods system and establishing the world central bank.
History will not simply return, and returning to the gold standard or the Bretton Woods era can only be an unrealistic fantasy. Developments in recent years show that most other reform proposals have not been effectively implemented. A fundamental reason is that the developed countries led by the United States did not have immediate pain in the financial turmoil, and the reform may damage their vested interests. Therefore, they are not active in the overall reform of the current international financial system, and they are even indifferent to or even opposed to the reform proposals that are of great concern to developing countries such as restricting international capital flows and reforming and reorganizing the IMF. In addition, the potential conflict of interest between them also makes it difficult for developed countries to reach a complete agreement on all reform issues. For example, the United States has always opposed Japan's promotion of monetary and financial cooperation in Asia, especially its advocacy of establishing the "Asian Monetary Fund".
Looking ahead, it can be considered that the current situation of the international financial system is unlikely to change significantly in the near future. However, in the medium and long term, with the sustained development of economic globalization, the economic ties between countries will be closer and deeper, and it is expected that more countries will actively devote themselves to building a stable and reasonable international financial system. This means that the above reform proposals may be gradually realized to varying degrees. As the largest developing country in the world, the government of China has made and will continue to make use of various international occasions to actively promote the reform of the international financial system. In fact, since 1999, China has played a very important role in promoting monetary and financial cooperation in Asia.