Despite the wake-up call of the Mexican crisis, the institutions had not responded by the time of the Asian crisis. It is therefore urgent that we review the capabilities and modalities of these institutions to respond to financial crises induced by large capital movements, he said. We must be mindful that the decision-making structures of the BWIs also need to be reviewed and made more inclusive and democratic. Broadening the decision-making process would help foster stability in the system. One of the most persistent problems and dilemmas pervading the current financial and monetary system is that of painful adjustments.
Many countries continue to be weighted down by inordinate debt overhangs.
These imbalances should be fully addressed. A representative of the Chinese delegation said the Asian crisis had shown up inherent weaknesses in the present financial system and there was now a widespread demand for reform and a need for the region s participation in the reform process. She noted that there are now many fora and agencies devoted to deliberations on reform and the rules of the game, and standards are being formulated. But the participation of developing countries is partial or even sometimes excluded, she said. Developing countries are asked to follow the standards and rules, yet we are left out of the negotiations setting these rules.