Integración del sistema financiero internacional (ingles)

Integration of the

Financial System

Introduction

One of the trends that with more notoriety have been observed last years has been the economic integration process at international level, which has included both the real sector and to the financial sector, being both types of integration complementary each other.

By the way of the real sector, the higher level of economicintegration of every countries with the rest of de worldwide economy, under of a scheme of free trade, incentivize to the available resources are allocated toward those activities in where has a competitive advantages at an international level, being the relative prices outcome of the international commerce by the which broadcast the incentives for this allocation.

The economic skill toallocate resources to the best utilization depends in crucial form that the financial system works efficiently. Therefore, furthermore of the importance of the properly and efficiently allocation of resources, is necessary that the countries’ economies integrate to the international financial system.

Financial Integration

The financial integration causes an increase in the capitalmobility, and therefore allows take advantage of opportunities of arbitration of the different financial markets. Hereby, international financial flows are the reflex of the existence of excesses of demand or supply of financial resources at the different economies.

The worldwide integration of the nationals markets, on having extended the options of financing of the companies, provokes thatthe financial cost is lower for those. That is translated to an increase of the returns of the projects of investment and a higher efficiency at the resources allocation. Furthermore, being integrate the financial systems, a significant reduction of the transaction costs in the international commerce, for what this activity tends to increase. By this way, the financial opening is perceived like acomplement indispensable of the international integration of the real sectors, since it reduces the transaction costs, increases the resources allocation´s efficiency and promotes a higher number of commercial exchanges at a worldwide level.

A clear example of integration nowadays was the European Union and how the different nationals’ financial markets are getting closer and controlled bythe European Central Bank, who decides about monetary policy for all states who signed to receive the euro as their own currency.

For the firms that the international commerce is a big part of their operations, is essential to have access to a great number of possible choices of financial products like banks, insurances, stock exchange to finance themselves, etc… allowing them to takeadvantage of their competitive advantages. If the firm´s national financial sector can´t supply it with the financial product that the firm demands with competitive prices, this firm should go to another market to satisfy itself. In short, is essential to maximize the growing development opportunities to exploit all the advantages that the commercial and financial opening involves.Integrating the domestic financial system with the outside forces to fiscal, monetary and exchange rate to be consistent each other’s and also consistent with price stability. This leads therefore to that the economy has low inflation, so the productive activities tend to develop in an environment not distorted where the relative prices reflect the true cost of resource opportunity.

Banking approachWith respect to each country´s banking market, allowing the participation of foreign banks, in addition to making this a more competitive market, with consequent gains in efficiency and productivity, also translates into an important source for the promotion of the domestic and foreign investment and international trade. I must qualify that this can only occur in countries where the whole...