Conference on Asian Architecture and Global Governance

The Conference on Asian Architecture and Global Governance was held on 29 October 2009 at Asian Development Bank (ADB) headquarters in Manila. The conference was jointly organized by the Asian Development Bank Institute, and ADB's Office of Regional Economic Integration (OREI) and the Economics and Research Department (ERD). The conference had four sessions plus a concluding panel discussion.

The first session had two papers. The first paper considered how to make international economic institutions (IEIs) more adaptable to the demands of a rapidly changing world economy. Using club theory, it argued that IEIs should be transformed by shifting more decisions from the global to the regional levels. The second paper examined the International Monetary Fund's (IMF) recent crisis management programs in Europe. It argued that the IMF had learned lessons from the 1997–1998 Asian financial crisis. As compared to the Asian programs, the European programs provided greater collaboration among stakeholders, more emphasis on ownership, and more built-in flexibility in terms of policy options.

The second session had three papers. The first paper considered how the United States dollar became the international currency of exchange. It advocated a more neutral currency such as special drawing rights and a low interest rate as the regime target for the international monetary system. The second paper considered the People's Republic of China's dollar challenge, and presented three possible scenarios for the future global reserve system. The third paper investigated whether East Asian countries have allowed more currency flexibility to cushion the impact of the global financial crisis. The author found that exchange rates have become more flexible, and that a majority of countries in the region have started targeting a basket of East Asian currencies.

The third session had two papers. The first paper considered trade and investment policies in Asia. It argued that new mileage could be gained by examining the regulatory framework and by providing better logistical and infrastructure support for intra-regional trade. The other paper considered an institutional framework for pan-Asian connectivity. It argued that by working together to strengthen infrastructure, Asian countries can unlock their vast economic potential, achieve sustained and inclusive growth, and reduce poverty.

The fourth session also had two papers. The first considered the political economy of regional integration. It tried to explain why progress toward economic integration has been slow compared to similar efforts in Europe and the Americas. The second paper focused on issues of regional integration in Asia from a European perspective. It highlighted key conceptual issues related to the mechanisms that determine how national and regional governance impacts the international process.

The conference concluded with a panel session. Panel members argued that regional cooperation and integration is important for Asia to achieve sustained growth. Greater market integration would allow Asian firms to produce more for domestic markets. They also advocated reducing factor market distortions that cause too many resources to be allocated to the export sector. Finally, they argued that regional safeguards such as the liquidity support provided through the multilateralized Chiang Mai Initiative need to be upgraded.