The evolution of the international financial system has been an ongoing process that has continued to develop over the past several decades. This evolution has been driven by advances in technology, changes in global economic and political dynamics, and the increasing complexity of the global financial system.
The international financial system began to take shape in the late 1970s and early 1980s, when banks, central banks, and multinational corporations began to establish a more global presence. This development led to the formation of the Basel Accords, which established a set of standards and regulations governing international banking activities. This was followed by the formation of the International Monetary Fund (IMF) and the World Bank in 1945, which established a framework for global financial cooperation and coordination.
Over the years, the international financial system has continued to evolve in response to the changing economic and political environment. This has resulted in the emergence of new financial instruments, such as derivatives and credit default swaps, and the growth of the international capital markets. In addition, the financial crisis of 2008-9 highlighted the need for greater oversight and regulation of the international financial system.
In recent years, the focus of the international financial system has shifted towards the development of more robust and efficient markets. This has included the establishment of the European Union (EU) and the introduction of the euro as a common currency. In addition, the globalization of capital markets has enabled investors to access a wider range of financial instruments and markets.
The evolution of the international financial system is far from complete and will continue to evolve in response to changing economic and political conditions. However, it is clear that the international financial system has developed significantly over the past several decades and plays an important role in the global economy.