Developing countries have long chafed under the control of international financial institutions run by the leading industrial countries. So the election last month of Mexicos Guillermo Ortiz to chair the board of the Bank for International Settlements the first person from outside the Group of Ten to do so is a significant development. The move comes as the Group of 20, which brings together developed and emerging-markets nations, has replaced the Group of Seven as the main forum for addressing the global economic crisis.
Ortiz brings plenty of experience to the Basel-based BIS, a prominent club of 55 central banks mandated to promote monetary and financial stability. He helped Mexico deal with its banking crisis in the mid-90s as Finance minister, and has served as governor of the countrys central bank since 1998. "He will have a lot of chances to raise awareness of central bank governors in industrialized countries," says Hung Tran, with the Washington-based Institute of International Finance.
In April, Ortiz will be joined by Jaime Caruana, who is leaving the International Monetary Funds monetary and capital markets department to become BIS general manager. The BIS "has warned for years about global asset bubbles and excessive credit expansion," notes Ted Truman, a senior fellow with the Peter G. Peterson Institute for International Economics in Washington. Ortiz and Caruana will have to make sure someones listening.