G20 AND IMF AS THE CENTRAL INSTITUTIONAL DETERMINANTS OF THE INTERNATIONAL FINANCIAL ORDER

Abstract

The continuously growing importance of the international financial legal order for the modern international community determines the scientific interest in international financial organizations, which form its institutional architecture. The topicality of the research is stipulated by the study of the influence of these organizations on the formation of the international financial legal order. The analysis of modern international financial organizations shows the absence of an international intergovernmental financial organization that would carry out central coordination of all other international financial institutions and conduct the international legal regulation in the field of finance, in accordance with the norms written down in its statute. These functions today the Group 20 and the International Monetary Fund are trying to fulfil. These two organizations differ significantly in formal and organizational features as well asin the way they impact the international financial legal order. The Group of 20 and the IMF actually play the role of central institutions in the organizational and institutional system of the international financial legal order, but the problem, in this case, is the lack of formal grounds for such functions, established legally and regulatorily. Although the economies of the Group of 20 account for more than 85 % of world GDP, they do not represent the economic interests of the entire international community, as they account for about a quarter of all countries in the world (including EU countries). As a result, decisions taken within the framework of the G20 (despite their constructiveness) may, to some extent, not be accepted by other countries due to the “non-participation” of these states in the development and adoption of such decisions. However, the current practice of the G20 shows the opposite. The analysis of the Group of 20 documents performed in the article shows that the provisions enshrined in them have a significant impact on the formation of the international financial legal order, and their content, in fact, reflects the “agenda” for their future development. An important feature of G20 documents is their specific targeting. In addition to the legal norms contained in the Group of 20 documents, most of the provisions are of the program and target-oriented character and are transformed into more detailed legal norms by other international financial organizations. They embrace the World Bank Group, the International Anti-Money Laundering Group (FATF), the Basel Committee on Banking Supervision (BCBS), the International Organization of Securities Commissions (IOSCO), the International Association of Insurance Supervisors (IAIS) and others. However, the International Monetary Fund plays a central role in them. The International Monetary Fund could have also taken on the role of the institutional center of the international financial legal order, among the existing international financial organizations, following the example of the G20, because of the largest number of member countries that enables the Fund to have the broadest representation of the financial interests in the international community. Moreover, its supranational powers stem from the IMF Charter, permitting the Fund to have legal influence over member countries through decision-making. permitting the Fund to have legal influence over member countries through decision-making, etc. That is, the scope of the Fund’s activities mostly extends to the international monetary legal order, in which the IMF functions as the leading international organization. But the international monetary legal order is only a part of the international financial legal order, albeit one of the most significant. Modern international relations practice demonstrates the expansion of the IMF’s powers due to which the Fund began to perform functions that were not assigned to it at the time of its creation. The carried-out analysis of the legal status of the Group of 20 and the IMF and the peculiarities of their impact on international financial relations demonstrates the dominant role of these institutions in shaping the international financial legal order. The specifics of the membership of the Group of 20, which includes leaders of 19 economically powerful countries and a representative of the EU, combined with “weighted” voting in the IMF, in which the number of votes depends on the size of the country’s contribution, led to the formation of a special organizational and institutional system of the international financial legal order, in which legal decisions on financial issues of a global nature are made by a narrow circle of financially powerful countries. Created in the modern international financial legal order, the “tandem” of the Group of 20 and the IMF effectively complements each other both in political and legal aspects.