International Finance: A Security Dimension

Abstract

The relevance of studying the security dimension of international finance under contemporary conditions is driven by increasing global economic instability, growing financial risks, and geopolitical challenges, which necessitate ensuring the resilience of international financial flows and strengthening the level of financial security of states and the global economic system as a whole. The article is devoted to examining the significance of ensuring the security of international finance. The aim of the article is to identify the security aspects of the functioning of international finance, in particular to define the essence of its security, identify key challenges and threats in this sphere, and substantiate approaches to improving its level of provision. The study reveals the relationship between financial globalization and financial security, analyses the evolution of regulatory processes and the internationalization of currencies, and examines the functioning of the international monetary system. The cross-border payment system is characterized, its contemporary features and operational challenges are identified, and the consequences of the internationalization of capital movements and global financial markets are outlined. Key problems of financial internationalization and financial regulation are identified, and the aspects of the internationalization of financial institutions are examined. Particular attention is paid to the existing shortcomings of the international financial system.

The paper systematizes scientific approaches to understanding the global financial safety net and its structural components. Special attention is devoted to analysing changes in the functioning of the Global Financial Safety Net (GFSN), including the use of foreign exchange reserves, central bank swap lines, the role of the International Monetary Fund (IMF), prospects for its activities, its cooperation with other international financial organizations, and the related challenges.

Additional attention is given to the mechanism of the Resilience and Sustainability Trust (RST) and to regional financial arrangements (RFAs), including bilateral and multilateral foreign liquidity agreements aimed at addressing balance-of-payments deficits in certain countries. A comparative analysis is conducted of the functioning of the IMF, the European Stability Mechanism (ESM), the European Fund for Sustainable Development (EFSD), the Chiang Mai Initiative Multilateralization (CMIM), the BRICS Contingent Reserve Arrangement (CRA), and the Latin American Reserve Fund. The key tasks and problematic issues of ensuring international financial security are identified.