Many reasons have been proposed for this apparent paradox, but one of them certainly is the weakness of financial systems in poor countries, as described earlier. This point leads us to a second benefit of financial globalization: Opening markets to foreign financial institutions promotes reforms to the financial system that improve its functioning.
And it was also when the International Monetary Fund was in the process of stretching a safety net around the world, shifting quota shares and voting power to emerging market and developing economies, and tripling its capital resources. So additional bilateral borrowing agreements with central banks needed to be negotiated and designed. These were mammoth tasks, not just politically but institutionally, too.