EFSD proposals aim to expand coverage of global financial security network

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YEREVAN, 23 September. /ARKA/. The G20 Expert Group (T20) has accepted a set of proposals designed by the Eurasian Fund for Stabilization and Development a href=https://efsd.org/press-center/news/rasshirit-pokrytie-globalnoy-setyu-finansovoy-bezopasnosti-i-povysit-koordinatsiyu-mnogostoronnikh-f/(EFSD)/a on enhancingnbsp;coverage of the global financial safety net (GFSN) and coordination of multilateral financial organisations. The proposals are available on the T20 website./pp

GFSN is an international multi-level system of financial mechanisms and institutions, consisting of countries' own reserves, bilateral swap agreements, regional financial mechanisms and the International Monetary Fund (IMF)./pp

The regional financial mechanism in the Eurasian region is the EFSD, in Europe the European Stability Mechanism (ESM), in South America the Fund for Latin American Reserve (FLAR), in the Middle East and North Africa the Arab Monetary Fund (AMF), and in Southeast Asia the multilateral Chiang Mai Initiative (CMI)./pp

Despite the diversity of objectives and instruments, all regional financial mechanisms share the common goal of promoting economic and financial stability. Their key advantages are speed of decision-making on financial support, greater flexibility and proximity to their member countries./pp

However, EFSD experts note that almost half of the countries have access to only two elements of the GFSN- reserves and the IMF - and regional financial mechanisms do not cover all countries. This not only increases the inequality of support to countries in case of crisis events, but also creates risks for the effectiveness of the response to global crises./pp

EFSD experts point to the need to launch the African Stabilisation Mechanism as soon as possible to cover the continent as fully as possible./pp

In addition, in developing countries that are actively attracting funds from international donors, there is a need for greater coordination between international financial organisations and development agencies, including through the creation of relevant platforms./pp

Such platforms operate in a number of countries, such as Kyrgyzstan and Tajikistan. They coordinate activities on a regular basis to avoid, inter alia, duplication of operations./pp

The EFSD has been actively involved in the work of the T20 since 2021 through the preparation of analytical papers and expert support. A representative of the Fund co-chairs the subgroup on multilateral development bank reform. The recommendations of the T20 are reflected in the final documents and decisions of the G20 leaders./pp

The Eurasian Fund for Stabilisation and Development (EFSD) is a regional financial mechanism with a volume of over $9 billion, which was established in 2009 by Armenia, Belarus, Kazakhstan, Kyrgyzstan, the Russian Federation and Tajikistan. The objectives of the EFSD are to promote economic and financial stability in the Fund's member states and to support their sustainable development.-0-/p