Brazil, India and South Africa: Low Spill-Over, High Resilience of Financial Sector

Martina Metzger

The course of the global financial crisis displayed widespread flaws in regulation and supervisory failure. The financial sectors of advanced countries piled up systemic risk comprising almost all financial institutions. In addition, high cross-border exposure between the financial institutions resulted in a core meltdown when the bubble burst in 2008. The financial sectors of many advanced countries risked collapse, meaning unprecedented monetary and fiscal intervention by policy authorities was necessary to stabilise the situation.

In contrast, many emerging market economies weathered the financial tsunami not only better than expected in terms of financial and macroeconomic stability given their previous performances during crises, but also better than G7 countries. Against this backdrop, we begin to question which factors account for the low impact of the global financial crisis and which features might explain the strong resilience of emerging markets’ financial sectors. The countries under consideration here are Brazil, India and South Africa. Apart from being heavy weights in their respective regions and continents, the financial sectors of these three countries showed a remarkable resilience to the global financial turmoil.

Waiting for the “Follow-Up”? – “Guiding Principles for the Implementation of the United Nations ‘Protect, Respect and Remedy’ Framework”[1]

Sofia Massoud

Florian Rödl

Globalisation, business and human rights
Globalisation has turned transnational corporations into decisive and powerful global actors. Correspondingly, the legal and actual power of states to regulate corporate behaviour has declined. As a result, transnational corporations can profit from a general race to the bottom in social and labour standards. As is now widely perceived, the race does not stop short of international human rights guarantees, including ILO international labour standards.

The UN Mandate on “Business & Human Rights”
On 24 March 2011, the Special Representative of the UN Secretary General (SRSG), Prof John Ruggie, issued a report on “Guiding Principles on Business and Human Rights” (Principles). This report is the culmination of the SRSG’s work on the subject of “Business and Human Rights” for several years. His general task was to clarify the roles and responsibilities of states and corporations in the business and human rights sphere, and then to map the challenges and to recommend effective means to address them.

Bringing Politics Back In

Nicolas Pons-Vignon

Many progressive economists and trade unionists have sought to engage in dialogue and negotiations with capital and governments during the global financial crisis, hoping they could achieve the adoption of reasonable and balanced policies. They may have done so because such an approach used to work in the past, especially in social-democratic contexts, or because, in the early days of the crisis, they were listened to as respectfully as during the high time of the “Keynesian compromise” in economics. They may be convinced that governments should “see” what is happening and want to adopt more inclusive policies. But as the General Secretary of the International Trade Union Confederation (ITUC) Sharan Burrow puts it in a Global Labour Column, “If during the crisis workers’ organizations could have anticipated that a new era of dialogue had begun, the moment has clearly passed”. Governments are indeed not seeing anything; in fact, the way in which they have responded to the crisis indicates that relying on strong arguments is insufficient. Are neoliberal policies, and the huge increases in inequality they have caused, responsible for the crisis? Well, the policies adopted in the wake of the crisis amount to more of the same – from the absence of any meaningful regulation (or rather, curtailment) of financial “innovation”, to the public bailing out of banks by states who then in turn reduce their spending, thus passing the costs of the crisis on to ordinary workers and unemployed people. Trade unions have been using their organizational and institutional power to resist relentless attacks on social and labour rights. Nevertheless, after decades of retreat, the financial crisis is rapidly weakening further their traditional pillars of power and influence. What is to be done?