Time to start thinking of a 'New Bretton Woods'?

A key decision in making US-led and China-led institutions complementary rests with the US Congress. Without the Congress ratifying the 2010 International Monetary Fund governance reforms to give greater voice to emerging markets, that will not happen. And as this is unlikely to happen any time soon, we perhaps need to start thinking of a "New Bretton Woods".

In the three-round match between the US and China to have influence in the Asian regional architecture, Round 2, which took place several months ago, went in China's favor. Countries like the United Kingdom, the Republic of Korea and Australia broke ranks with the US, and 57 countries from across the world, including Germany, France, Iran, the United Arab Emirates and Nepal, applied to be the founding members of the Asian Infrastructure Investment Bank. Japan has so far stuck to the US but it has indicated that it remains interested in joining the AIIB, which can be seen as the financing arm of China's Belt and Road Initiative.

Initially, the US attempted to dissuade potential applicants by citing poor governance and due diligence at the proposed AIIB. But it made a dramatic turnaround later.