Complacency Is Not an Option

The digital revolution has spawned a new economy driven increasingly by intangibles and data, but institutions and governance have not kept pace with change.

In this op-ed, a version of which was published in iPolitics, CIGI President Paul Samson writes that data governance will be essential to international cooperation in the near term. At the same time, further fragmentation of the existing order risks entrenching digital realms around the world into shielded blocs. What are the options for the path ahead?

Join Samson and CIGI Managing Editor Michael Den Tandt on Tuesday, October 18, at 12:30 PM EDT (UTC–04:00), for a Twitter Spaces chat about this new piece.

The multilateral architecture created after the Second World War provided a set of rules that helped to settle, or at least limit, conflicts. But in the past five years conflicts have multiplied, and the rules-based international order has suffered several significant blows.

Hector Torres writes that as the multilateral system weakens, both the International Monetary Fund and the World Trade Organization need symmetrical reforms. A “grand bargain” might be the approach that could rejuvenate trust in their capacity to preserve economic interdependence.

In his new paper, Pierre L. Siklos explores two major forces that will dictate the emergence, spread and eventually the success of retail central bank digital currencies, or CBDCs, globally: first, the potential for a foreign retail CBDC to displace existing domestic currencies and, second, the scope for international cooperation in the rollout of retail CBDC. He identifies select economic and political factors that may explain the potential for shifts in currency holdings. The prospects and challenges he outlines regarding the deployment of retail CBDCs are ones that apply to all countries, not just Canada. Learn more in this video and read the paper here.

In a related opinion piece this week, Siklos writes that 10 countries have already launched, and another 100 are investigating launching, their own CBDCs. The growing fear of being late to launch a retail CBDC is legitimate among some other central banks who are stuck in the researching phase, but, Siklos says, if they allow fear or delay to keep their currency from the CBDC movement, there will be a price to pay. Read “A Digital Loonie Can Thrive in a World of Competing Currencies.”