The Development, Significance, and Contemporary Challenges of the Global Financial System (Analytical Review)

Abstract

The global financial system serves as a cornerstone of the modern economy. Financial institutions within this system
facilitate the movement of capital, support international trade, and enable global investment flows. Its origins can be traced
back to ancient times, and it has undergone continuous evolution ever since. Nevertheless, the system faces a range of
contemporary challenges, including geopolitical tensions, armed conflicts between states, inflation, cybersecurity threats,
climate change, and the complexities surrounding cryptocurrency regulation. These issues create substantial difficulties for the
stability and functionality of the global financial framework. Georgia’s financial sector is no exception. It is similarly affected
by inflation, currency risks, and a shortage of investment, all of which hinder the country’s path toward sustainable economic
development. In this context, the continuous improvement of financial policy and the deepening of international cooperation
are essential. These efforts are critical for fostering a stable and sustainable financial environment.