The International Monetary Fund (IMF) plans to sell gold over the next few years to stabilize its funding and head off projected losses, according to The World Bank Press Review.
The Fund’s Executive Board approved a plan Monday to have it focus less on lending and more on monitoring the economic prospects of its members and examining the global financial industry and other sectors.
The IMF is focusing more on country foreign-exchange rate policies and putting together a code of ‘best practices’ for sovereign wealth funds, to make sure they operate in a commercial fashion.
SØGER AT KOORDINERE
The IMF said it would coordinate its gold sales with a program that manages the sale of gold from central banks.
That program, which covers the sale of as much as 500 metric tons annually, is overseen by the European Central Bank.
KONSOLIDERING FOR FREMTIDEN
IMF Managing Director Dominique Strauss-Kahn welcomed the IMF’s Executive Board decision to present the plan to narrow an annual gap between income and expenditure of around $400 million (1,9 mia. d. kr.) within a few years.
It is ‘a landmark agreement that will put the institution on solid financial footing and modernize the IMF’s structure and operations,’ he said.
FYRINGER OG UDSALG AF GULD
The board of the IMF voted Monday to cut 15 percent of its staff and sell about $11 billion (52,2 mia. d. kr.) in gold reserves in one of the biggest shake-ups of its funding since it was founded.
The IMF plan to cut 380 jobs and sell 403.3 tones of gold, about an eighth of its reserves, still has to be approved by other authorities.
USA FORSINKER
The reforms have the support of the US Treasury, but the gold sales must be approved by the US Congress, which is unlikely to happen until after the presidential elections this year.
HENSYNET TIL MARKEDET
IMF officials said the sale would likely take place over several years in an effort to avoid market disruption.
Still, the sale could have a dramatic impact on the market, where according to IMF officials some 500 tones are traded annually.
TRIMMING AF IMF
At the same time, the board considered the medium-term budget for the financial years 2009-2011, which includes ‘deep spending cuts’ of $100 million, and approved the administrative budget for the 2009 financial year that begins May 1, 2008.
– We have made difficult but necessary choices to close the projected income shortfall and put the fund’s finances on a sustainable basis, but in the end it will make the fund more focused, efficient and cost-effective in serving our members, said Strauss-Kahn.
Kilde: www.worldbank.org
