In their article, Anderlini and Clover (2009) speak about China’s and Russia’s desire to purchase IMF bonds. While China considers buying about $50bn of IMF bonds, Russia seeks to spend no more than $10bn for these purposes. Both countries will use these investments according to essential criteria of reasonable returns and safety, which are in no way associated with the countries’ search for additional political power in international contexts. It appears that for Russia and China to purchase IMF bonds means to express their desire to trace and monitor the distribution of international monetary commitments.
The money Russia and China are prepared to pay for IMF bonds is expected to help developing countries tackle with the major economic challenges. For example, Russia proposes that IMF uses additional funds to help Ukraine resolve its gas issues with Russia (Aderlini & Clover, 2009). Although the IMF is not very optimistic with regard to sponsoring Ukraine in its balance payment issues, purchasing bonds may shape a good ground for better stability in broader financial markets. Response
The fact of Russia and China seeking to purchase IMF bonds signifies the growing international commitment to reducing trade barriers. With the growing realization of the benefits which the reduction of trade barriers can bring internationally, the IMF bonds and additional funds can be readily used to support developing countries in their striving to better trade liberalization and business openness. On the one hand, the developed countries’ desire to stimulate international trade signifies their preparedness to better dialogue with developing countries in terms of business and trade.
On the other hand, such openness also provides developing countries with better chances to become a part of the developed business community. As a result, whether the changes in the structure of international financial assets help reduce trade barriers also depends on how well countries and organizations manage them. Response 1 In his article, Bogoslaw (2009) suggests that the time has come when India, Brazil, and China should become the major investment targets.
Given that the state of economy is not limited to economic markets in the U. S. , it is more than important to look beyond the boundaries of the American economic attractiveness and to provide other countries with a better chance for economic growth. It should be noted, that the concept of market economic system is integrally linked to the concept of economic freedom, and where countries seek to implement the principles of market economy these imply the absence or minimization of governmental involvement. In case of China, India, and Brazil, governments still remain the powerful elements of economic growth.
Simultaneously, dozens of smaller developing countries need additional investments for their gradual transition to free market relationships. Thus, not Brazil or India with their well-established economic images, but other developing countries with sound legal systems and investment opportunities should attract additional funds. In any case, stocks and investments always involve risk, and if investors believe that by cooperating with India or China they secure themselves from the major losses, they are deeply mistaken.
Response 2 For many years, embargos have been an effective measure of economic and diplomatic discipline. The leading world powers frequently apply to embargo as the measure of last resort, and whenever countries are unwilling to follow the basic principles of international legal or economic conduct, embargos appears the most reliable method of imposing balanced legal and economic requirements on them. It appears that to stop supplying countries with the critical resources is more important that trying to persuade such countries to change their convictions and political beliefs.
It should be noted, that embargo implies putting a legal ban on commerce, and individuals are those who suffer these limitations the most. As a result, whether embargo is an effective measure depends on what perspective one chooses to review its benefits and drawbacks, but that embargos significantly reduce the scope of the major business operations and prevent individuals from achieving their individual purposes is clear.