By Paul Blustein
Washington Post Staff Writer
Saturday, April 18, 1998; Page D01

There was plenty of buzz about the creation of a "new international architecture" as hordes of economic policymakers descended on Washington this week for the spring meetings of the International Monetary Fund and World Bank. In the aftermath of the Asian financial crisis, the barons of the world economy were determined to start changing the rules of the global financial system to make future crises less likely and more manageable.

But by yesterday, when the last speeches were read, the final communiques issued and the concluding news conferences held, it was clear the system is headed for change that is far more evolutionary than revolutionary.

Nine months after a plunge in the Thai baht sparked a massive flight of capital from the world's most dynamic region, policymakers at the IMF and the world's richest countries are still wincing about how the system kept them from handling the crisis more effectively. The IMF's tradition of secretly and diplomatically counseling member countries to improve their economic policies, for instance, meant that its advice was dismissed by self-confident ruling elites in countries such as Thailand and South Korea -- until their financial markets collapsed and multibillion-dollar bailouts became necessary.

So now the IMF is bent on becoming a more assertive institution, with the aim of doing a better job of heading off crises before they get out of control. On Thursday, its policymaking interim committee unveiled plans for the IMF to develop a "tiered response, whereby countries that are believed to be seriously off course in their policies are given increasingly strong warnings."

As an international organization whose membership consists of sovereign nations, the IMF has always been leery of criticizing the policies of member countries too publicly or bluntly -- in part because doing so might trigger the very crisis the fund was trying to avoid. But using a soccer analogy, IMF Managing Director Michel Camdessus vowed at a news conference that he will "show the yellow card a little more," and he suggested the IMF was prepared in extreme cases to use "the red card of going public with its negative opinion on a given country."

Still, this hardly means the IMF will go so far as to turn itself into some sort of international whistle-blower, as urged by some critics who consider the fund too obsessed by secrecy.

"The essentially cooperative character of the IMF is not changed," said Shailendra J. Anjaria, the IMF's director of external relations. "If there's one thing everyone agrees on, it's that the IMF must maintain the confidence of member countries, and it must maintain the confidentiality of information it receives in confidence."

Other reforms launched this week essentially consist of extensions and enhancements of initiatives that were conceived after the Mexican peso crisis in 1995. For instance, instead of simply asking countries to publicly disclose their reserves of international currencies, the fund will ask them to reveal more detailed data so that nasty surprises won't crop up as they did in the cases of both Thailand and South Korea, whose reserves turned out to be effectively much lower than the official figures suggested. In Thailand's case, much of the reserves had been committed for future currency transactions.

Even though some of the plans for changes in the system are aimed at improving disclosure about one of the main problems that emerged in Asia -- the weakness of banking systems -- nobody at the meetings was promising the new procedures would produce miraculous results.

"I think there is a general recognition this time that we could have done better" in managing the crisis, James D. Wolfensohn, the World Bank's president, said. "We'll probably fix this, there will be a new architecture, there will be greater transparency, but my guess is that in five or seven years, there will be another crisis based on some other factor that we don't now anticipate."

Indeed, even as discussions took place on preventing future turmoil, the weakness of the Japanese economy raised the troubling prospect the Asian crisis might worsen anew.

Japanese officials attending the meetings voiced exasperation that their efforts to stimulate their nation's economy had drawn little but skepticism from U.S. Treasury Secretary Robert E. Rubin and his colleagues among the Group of Seven industrial countries, but by week's end, as the yen and Tokyo stock prices continued to fall, warnings were being issued by Japan's usually polite neighbors as well.

"If the yen continues to weaken, there may be another wave of competitive devaluations of Asian currencies," Joseph Yam, chief executive of the Hong Kong Monetary Authority, told reporters. "I see Japan as the big question mark of Asia."