CIGI Papers

CIGI Papers present well-considered policy positions and/or research findings, insights or data relevant to policy debates and decision making. This category includes papers linked to particular projects or topic areas.

China in the G20 Summitry: Review and Decision-making Process

October 15, 2014
CIGI Papers No. 46
As the largest emerging economy, China believes that the Group of Twenty (G20), instead of the Group of Eight (G8), is the ideal platform for its participation in global governance. This paper examines the reasons why China joined the G20 rather than the G8, and then focuses on a detailed review of China’s participation in G20 summits since the enhanced forum began in 2008.

The Effect of Index Futures Trading on Volatility: Three Markets for Chinese Stocks

September 30, 2014
CIGI Paper No. 44
Pierre Siklos, Martin T. Bohl, and Jeanne Diesteldorf
This paper examines whether the introduction of Chinese stock index futures had an impact on the volatility of the underlying spot market. To this end, several Generalized Auto-Regressive Conditional Heteroscedasticity (GARCH) models are estimated and compared with findings for mainland China with Chinese index futures traded in Singapore and Hong Kong.

China and Sovereign Debt Restructuring

September 29, 2014
CIGI Papers No. 45
More than a decade after it put forth the idea of the Sovereign Debt Restructuring Mechanism in the early 2000s, the International Monetary Fund (IMF) is again seeking to engage various stakeholders in a new round of discussions about improving sovereign debt restructuring. As a major international creditor, China is an important force to reckon with, but thus far, its government has said little publicly regarding the recent IMF reports on this issue. Chinese policy makers and analysts are supportive of the IMF’s attempt to explore ways for earlier and more orderly debt restructuring, but they find the proposed reforms to be only marginally useful.

African Perspectives on Sovereign Debt Restructuring

September 24, 2014
CIGI Papers No. 43
On August 7 and 8, 2014, CIGI’s Global Economy Program co-hosted a conference with Uganda Debt Network to discuss African perspectives on sovereign debt restructuring. Conference participants prepared papers and presentations on various topics related to sovereign debt governance, including Africa’s past experience with sovereign debt restructuring, its stake in sovereign debt governance going forward and the desirability of reforming the international sovereign debt architecture. The aim of this paper is to distill the main insights from these timely and important contributions. Africa’s extensive experience with sovereign debt restructuring, as well as the changing nature of its international debt relations, make the perspectives contained in this paper valuable contributions to the ongoing debate over how best to govern sovereign debt at the international level. The paper also sheds light on the interests and concerns of African leaders regarding sovereign debt — an issue that is particularly critical to Africa’s development prospects.

Reforming the Global Architecture of Financial Regulation: The G20, the IMF and the FSB

September 22, 2014
CIGI Papers No. 42
The global financial crisis that began in 2007 and deepened in 2008 exposed major weaknesses in financial and macroeconomic policy coordination, and profound flaws in financial risk management and regulation in a number of advanced countries. The severity of the crisis led global leaders to recognize that they must find a way to reform the global regulatory architecture to ensure that the financial system can absorb shocks while continuing to function efficiently. The analysis in this paper suggests a number of actions that the IMF and FSB should take to strengthen their cooperation and effectiveness, and highlights some of the problems created when no single agency has overall responsibility for the regulatory oversight of the international financial system.

Organizational Culture, Learning and Structure in Central Banks: Best Practices and the Case of the Moroccan Central Bank

September 15, 2014
CIGI Papers No. 41
This paper provides both theoretical and empirical evidence that maintains that a central bank’s organizational structure, culture and learning system are important for achieving best governance practices. It argues that a central bank’s organizational structure and culture facilitate the effective implementation of governance practices that have been enacted by law or in a strategic plan, with specific reference to central bank independence, communication, transparency, professionalization, technical excellence and reputation risk management.

Crisis Management Mechanisms: Pathologies and Pitfalls

September 4, 2014
CIGI Paper No. 40
As events demonstrate on a regular basis, the Asia-Pacific is a region prone to crisis. In recent years there has been a marked increase in the use of military force to signal interests or resolve, and even, in some cases, to alter the status quo, particularly in the East and South China Seas. No country in the region desires conflict, owing to their high levels of economic interdependence, but it is clear that in a context of rising nationalism, unresolved historical grievances and increasing hostility and suspicion, there is no reason to be complacent about the prospect of future conflict. Hence the recent surge in interest in crisis management “mechanisms” (CMMs). This paper explores the dangers of thinking of crisis management in an overly technical or mechanistic fashion, but also argues that sensitivity to those very dangers can be immensely useful. It draws upon US and Soviet experiences in the Cuban missile crisis to inform management of a hypothetical future Sino-American crisis in the East China Sea, and to identify general principles for designing and implementing CMMs.

China's Goals in the G20: Expectation, Strategy and Agenda

August 27, 2014
CIGI Paper No. 39
The G20 has emerged as the lynchpin of China’s involvement in global economic governance. It remains the only economic institutional setting where the country can operate on par with major Western powers. China has a strong interest in maintaining the status of the G20 as the premier forum for economic cooperation, and a vested interest in ensuring that the G20 does not degrade into yet another “talk shop” of multilateral diplomacy. However, the Chinese leadership’s current approach to the G20 is not driven by a desire to position the country as a leading agenda setter.

Equator Principles Reporting: Do Financial Institutions meet their Goals?

August 19, 2014
CIGI Paper No. 38
The Equator Principles (EP) are a voluntary code of guidelines for financial institutions to report on environmental and social issues of projects. This paper examines how often members of the EP report and what content should be disclosed. Using institutional theory as the theoretical framework for the analysis, seven criteria (annual reporting, disclosure of screened transactions, the categorization of projects with respect to their assessment status, risk category, sector, region and implementation experience ) were used to test whether members report according to the EP’s guidelines. Results highlighted challenges with reporting compliance and transparency. To counter these obstacles, this paper recommends strategies such as enforcement, standardization reporting or third party validation to increase the adherence to and the transparency of the EP reporting.

The Role of International Trade in the Rise of the New Zealand Dairy Industry from Its Beginnings to the Fonterra Era

August 13, 2014
CIGI Paper No. 37
Within the dairy industry, New Zealand is a giant. However, the neocooperative and free market management system has attracted the ire of larger competitors such as the United States and the European Union. This paper provides an overview of the history of the New Zealand dairy industry and the changes the New Zealand government has made to remain agile and receptive to change, including restructuring the industry to place the New Zealand Dairy Board and later Fonterra as the sole exporter of dairy products. But, as this paper argues, perhaps New Zealand’s biggest challenges and obstacles lie ahead. In light of potential trade liberalization within mega deals and increasing competition from the United States and the European Union, New Zealand must now be aggressive and innovative in finding new markets, maintaining their export base and standing their ground in the face of cut-throat and unapologetic international competition.