And indeed the European Union is fully engaged in working, together with other members, on proposals to strengthen the WTO in areas such as subsidies, e-commerce, property rights and ensuring enforceability of existing WTO commitments with a well-functioning dispute settlement system that cannot be blocked by any single country.11 At the same time, it is important that the European Union should continue to negotiate trade agreements with other partners. Although, as mentioned earlier, this is not a first best solution, it is time to recognise that regional and multilateral arrangements open to others can succeed where multilateral negotiations have failed to bring many countries into the international trading system. In the financial arena, the emergence of regional initiatives has generated a more robust and better resourced global financial safety net. However, coordination between the different layers should be strengthened, on the understanding that a regional system can complement, but not substitute, the role of the IMF. In my view, the IMF is still essential, for at least four reasons. First, it has unique expertise in crisis management. Second, the participation of the IMF in adjustment-programme design adds an objective view that regional institutions cannot provide, one that is respected both by domestic authorities and by the private sector. Third, in cases of interconnected economies, the involvement of the IMF can dissipate the potential regional concentration of risks.
BIS Review 23/2006  1