Reform of Global Finance in the Context of Sustainable Development

DOI: 10.20542/0131-2227-2018-62-7-38-47

L. Khudyakova (,
Primakov National Research Institute of World Economy and International Relations, Russian Academy of Sciences (IMEMO), 23, Profsoyuznaya Str., Moscow 117997, Russian Federation

Abstract. Adjusting the global financial system in order to support sustainable development of the world economy becomes an imperative of the XXI century. The article analyses the main drivers and obstacles to this process as well as action programs aimed at achieving this goal. Three main groups of actors are considered: national governments and financial regulators, international organizations and private financial institutions. The rapid growth of the number of informal international alliances and initiatives supporting sustainable banking, investments and insurance is really impressive. The author points out that the main direction of transformation of the global financial system is “to go green”. Within this general trend the principle of “double dividend” can be applied and the economic gains can be achieved together with ecological ones. Achievement of social goals can be ensured by further development of the financial inclusion and improvement of the financial management and standards. Financial innovations, including digital finance, increase of SMEA financing, development of green finance clusters with diversified green instruments inside the international financial centers are considered among the main accelerators of such transformation. A very important feature of the recent years is constantly increasing participation of the rapidly growing developing countries, especially China, in the green finance initiatives. This country is not just seeking to solve its national ecological and social problems. Basically, it is interested in creating and occupying its own niche in the changing global financial system with the purpose to make it more connected with the real economy, more equal and fair. The author concludes that strong governance is critical for ensuring the real progress in green and sustainable finance. The Roadmap, prepared by UNEP/World Bank in 2017, contains not only the list of necessary next steps but their timing. This document may be helpful for all countries, including Russia, and for their cooperation, aiming to align financial system to sustainable development for future prosperity.

Keywords: global financial reform, sustainable development, green finance, UNEP, international organizations, financial inclusion, financial institutions


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For citation:
Khudyakova L. Reform of Global Finance in the Context of Sustainable Development. World Eonomy and International Relations, 2018, vol. 62, no. 7, pp. 38-47.

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