Months after the formation of new financial institutions like the $100 billion BRICS Bankand the China-led Asia Infrastructure Investment Bank, Christine Lagarde, managing director of the International Monetary Fund (IMF), said Friday that the organization is ready to discuss IMF voting reforms without the United States to give BRICS and emerging countries greater voting power.
Lagarde said the IMF is disappointed with the US inaction to ratify the governance and quota reforms and will now move forward without Washington.
“The IMF’s membership has been calling on and was expecting the United States to approve the IMF’s 2010 Quota and Governance Reforms by year-end. Adoption of the reforms remains critical to strengthen the Fund’s credibility, legitimacy, and effectiveness, and to ensure it has sufficient permanent resources to meet its members’needs,” Lagarde said in a statement.
“I have now been informed by the U.S. Administration that the reforms are not included in the budget legislation currently before the U.S. Congress. I have expressed my disappointment to the U.S authorities and hope that they continue to work toward speedy ratification,” she said.
“As requested by our membership, we will now proceed to discuss alternative options for advancing quota and governance reforms and ensuring that the Fund has adequate resources, starting with an Executive Board meeting in January 2015,” she added.
Earlier in September this year, in her opening address at the United Nations General Assembly, Brazilian President Dilma Rousseff warned that international financial institutions are in danger of losing legitimacy if developing countries like BRICS are not given proper representation.
“It is also imperative to eliminate the disparity between the growing importance of developing countries in the global economy and their insufficient representation and participation in the decision-making processes of international financial institutions, such as the Monetary Fund and the World Bank. The delay in the expansion of voting rights of developing countries in these institutions is unacceptable,” Rousseff said.
“These institutions are in danger of losing legitimacy and efficiency,” she added.The BRICS Post
US isolated, BRICS to get greater voting power at IMF
3 comments:
Its probably not in the legislation because the crazies think "we dont have any more money to give to the IMF! we're out of money!!"
The IMF was primarily designed to smooth out forex clearing issues, unstable equilibrium in BoP, but instead became a tool of progressive and conservative political activists to impose their ideology on development in countries who are vulnerable.
The IMF is more significant to developing nations than to developed nations because the investment and resources typically utilized/imported during development have been more than markets alone could handle and lead to instability.
In the United States, where we have the advantage of deep markets because of reserve status, people sort of shrug and think who the heck cares! The IMF has little bearing directly on any lives. Congress doesn't even think the issue is worthy of five minutes time, funding for a street improvement in Omaha gets more time. Perhaps fewer special interests, especially from the radical progressives and their neo-lib brethren along with their conservative counterparts will make the institution better serve its original purpose.
The US likes the IMF the way it is. You'd think that IMF officials would too.
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