economic growth even at the expense of growth elsewhere. protectionist and “ beggar - thy - neighbour ” policies would have certainly aggravated the crisis, as they notoriously did in the 1930s, and yet somehow it could have been expected in such dire circumstances and given the political difficulties associated to them. a good system is one where these self - defeating pressures could be resisted. how has the global system fared in this regard? i will look into five dimensions, namely ( i ) protectionism, ( ii ) central bank cooperation, ( iii ) regulatory arbitrage, and ( iv ) global imbalances. crockett ( 2009 ). frieden ( 2009 ). 2. 1 protectionism a systematic look at recent trends in global protectionism indicates that there has so far been an only moderate increase in actual protectionist measures to restrict trade through tariff and non - tariff barriers. according to the wto, a significant outbreak of trade protectionism has been avoided since the start of the crisis : the new trade - restricting or distorting measures introduced between october 2008 and october 2009 accounted together for 0. 8 % of world imports, while those adopted between september 2009 and february 2010 amounted to an additional 0. 4 % of world imports. yet more protectionist pressures might be on the pipeline. first, evidence from surveys shows that public pressure for more economic protection not only has been mounting since the mid - 2000s, namely well ahead of the crisis, but has intensified since its start. second, the global trade alert, an initiative of a network of five independent research institutes across the world, reports that 390 trade - damaging state measures were announced by g20 members in the 14 months from november 2008 to december 2009. over the same period, the g20 passed only 56 measures that benefited importers. 7 this leads me to conclude that in the trade field, while a repetition of the experience of the 1930s is not in the cards, there is certainly no room for complacency and vigilance needs to remain high. 8 2. 2 central bank cooperation another dimension of international cooperation that has worked well during the financial crisis has been that among central banks, channelled through the various basel and bank for international settlements ( bis ) committees. this institutionalised cooperation has ensured an unprecedented degree of collaboration and coordination in the provision of cross border liquidity. 9 information sharing among central banks has also worked very well, for example on the occasion of the bank for international settlements ( bis ) global

economy meetings that are held every two months in basel and where central bank governors from systemic economies have the occasion to discuss issues the global economic outlook, international monetary and financial issues and other issues of mutual interest. clearly, these fora have turned out to be very useful in times of global financial distress and we should continue to invest on them in the future. i would also like to mention that the bis as an institution has been “ ahead of the curve ” in terms of identifying unsustainable trends in the financial sector and more generally in the global economy – such as the under - appreciation of risk and excessive credit growth – which eventually led to the global financial crisis. it could do so based on a high degree of analytical depth and information sharing at a global level that the bis and the basel committees have been able to develop over time. these analytical contributions have played a non - negligible contribution to form the strong and coordinated policy response that we have witnessed during the financial crisis. see baldwin ( 2010 ), in particular chapter 5 by s. j. evenett. model - based simulations ( bussiere et al. 2010 ) suggest that the impairment of the global flow of trade would hamper the recovery from the crisis, as well as the long - term growth potential of the global economy. at the same time, it is unlikely that protectionism would help to correct existing current account imbalances. moreover, the countries implementing protectionist measures should expect a deterioration of their international competitiveness, which would further affect the potential for longer - term real gdp growth. see cgfs ( 2010 ). 2. 3 where the system has fared less well : regulatory arbitrage and global imbalances as much as global governance appears to have passed the severe test of the global financial crisis, we should not remain oblivious to the fact that there were significant shortcomings that may have contributed to create the conditions for the crisis to happen in the first place. i will mention, in particular, two dimensions : the insufficiencies in terms of financial regulation and international coordination, on the one hand, as well as the constellation of global imbalances, on the other. let me deal with both in turn. the lack of integration and coordination in financial regulation was pervasive before the crisis, even though this was not properly appreciated at the time, and has encouraged financial institutions to engage in a large degree of regulatory arbitrage. 10 this was the unavoida