In 2018, many emerging economies in the world are in financial crisis due to continued US interest rate hikes and trade wars. Russia, Iran, Turkey, Venezuela, Brazil, and Argentina have experienced large currency depreciation during the last months which resulted in inflation and debt crisis and subsequently shed a shadow on the world economy.

Argentina then turned to the International Monetary Fund (IMF) to seek help. The IMF agreed to provide 50 billion US dollars in bailout loans in June this year and later in September, announced that it had increased the size of its aid to Argentina from 50 billion to 57.1 billion US dollars, making it the largest loan aid in the history of the IMF. However, as one of the conditions for the bailout plan, the Argentine central bank agreed to intervene in the foreign exchange market only in extreme cases. In addition, Argentina also pledged to reduce the 2019 fiscal deficit to zero.

The IMF is the major institution that maintains international financial stability. During the Asian financial crisis, the IMF provided aid loans to Thailand, Indonesia and South Korea which helped these countries gradually step out of the financial crisis. Nevertheless, the IMF's financial aid was not always effective and their prescriptions failed in many aid recipient countries.

The IMF has already admitted that it made mistakes in its bailout plans and pushed for further economic recession in the Greek case, while it still continues to lend billions to Argentina. Perhaps it's time to look inside and push for reforms to better oversee the two most important financial institutions.

Although the purpose of the IMF is to foster global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty around the world, the IMF's fund share, decision-making procedures, voting rights, and conditions of assistance are highly controversial.

The World Bank, another multilateral international organization, has played an important role in reducing poverty and improving living standards. But the World Bank's functions and responsibilities in promoting the development of the world economy, especially in developing countries, have long been criticized. In terms of institutional governance, the problems of the World Bank are also very obvious.

In the current voting rights reform, the process is very slow; the situation in which the World Bank is dominated by a few advanced economies has not changed. The United States is the World Bank's largest shareholder and the only country with a veto.

The World Bank has a mechanism in which shares are linked to voting rights. The United States holds about 17 percent of the shares, and some developing countries, especially those in the African continent, have very few seats due to economic strength, which directly makes their voices hard to hear. In addition, the leaders of the World Bank are not directly elected. The leadership positions are generally held by the US, and third world countries are excluded from management.

Loans offered by the IMF and the World Bank are generally low-interest but often accompanied by high economic and political conditions, such as taxes increasing, economic privatization, interventions reduction, open markets and export promotion.

In addition, the IMF and the World Bank provide loans only when votes exceed 85 percent of the voting rights of the executive board. The United States has more than 15 percent of the shares in both organizations, so it has a "one-vote veto."

The IMF and the World Bank have already recognized – in a slow way – that problems and failures exist. But actions to address them need to be put on the agenda as soon as possible.