Year XXXVIII, Number 3, November 2025

Fabio Masini 
Professor at Roma Tre University, Jean Monnet Chair in European Economic Governance.

Trump’s administration is challenging the  international economic and monetary system,  as it has been evolving since the Bretton  Woods monetary conference in 1944. In the  last few decades, the US/dollar hegemony has  been weakening, giving rise to an alternative  block of financial and economic infrastructure,  led by China with the BRICS+. This is leading  to a weaponization of currencies, which might  dramatically challenge the stability of the  world economy. We need to return on a path  to multilateralism, built on the relaunching  of regional integration projects in the major  continental areas of the world. 

The emergence of the Triffin Dilemma

Since 1959 Robert Triffin exposed the intrinsic  weakness of an international monetary system  relying on a national currency for the provision  of international liquidity, underlining the  conflict between domestic and international  goals for the hegemonic country. This  contradiction has been perpetuated (and never  fixed) via the weaponization of the dollar for  political aims, allowing the US to invest in  domestic and foreign expansionary initiatives  despite the shortage of domestic saving,  thanks to the role of the US-Treasury bond as  safe asset par excellence. 

The increasing need to accumulate reserves  in US dollars, as a cushion against potential  and sudden capital flights (after the crises  of the late 1990s), has given rise to the huge  global imbalances that the world has been  experiencing in the last 25 years, with the  
perverse effect of low-income countries de  facto financing US expenditures. The financial  crisis of 2008-9 triggered calls for reform of the  international financial architecture, which was  resisted by the USA. Hence the emergence of  the BRICS around the growing role of China  and the recent bipolarization of the world  economic and monetary system. 

We let interdependence increase without  governing it 

Globalization increased, capital markets  were mostly made free to shift huge  amounts of money in real-time, assisted  by deregulation and lack of enforceable  global legislation. This allowed for returns  on financial speculation to increase, but at  the cost of greater distributive inequalities,  decreasing investment in long-term projects,  excess global saving. 
An unsustainable situation that caused  counter-reactions against financialization  of the economy, globalization, and greater  requests for (national) economic and social  protection, that has led to nationalism and the  emergence of authoritarian governments. 
The problem, though, was not globalization per  se, or the free movement of capital, but the  lack of any supranational management of  such processes, that allowed for the ill-effects  of such unconstrained evolution to emerge.  Unmanaged interdependence, that would  have required collective action at a supra national level, is causing, through attempts at  fencing off its negative effects, the disruption  of its positive effects.

A new international order 

If we want to resist a return to a bipolar  confrontation and increasing economic and  military conflicts, we need to accelerate  the building of a multipolar system, based  on continental poles of similar economic,  monetary, political/military dignity (strength).  Hence the need to accelerate on regional  integration in areas like Central and Latin  America, Africa, South-East Asia. All places  where some embryonic initiatives have been  under way for some time already, that now  need to be made effective. Maybe starting  from making regional free trade agreements  operational, strengthening regional financial  safety nets, building regional currencies.  A larger use of the Special Drawing Rights  (the only multicurrency asset issued by the  International Monetary System) as an anchor  for regional currency unions, trans-national  payments, financing of global merit goods  
(such as poverty reduction, sustainable  development, struggle against climate change,  etc) would be a key step in such process. 

The role of Europe 

The advantage of the above-mentioned regions  is that they can count on the experience  (successes, failures, critical knots) of regional  integration in Europe. The European Union,  the most advanced experiment in supranational  institutional building in the world, is called to  assume greater responsibility as a model for  other regional integrations; accelerating on its  process towards global actorness, provision of  regional public goods, (security, energy, strategic  infrastructures, etc) and greater international  role of the euro, with the costs and privileges  related to this. Not aiming at substituting the  dollar hegemony, as some have suggested, but  at building a more equitable multilateral and  multi-layered global governance.