A first round of discussions by International Monetary Fund (IMF) member countries on a proposal to increase the voting power of emerging powers like China were “substantive and constructive,” an IMF spokesman said on Thursday, according to World Bank Press Review.
The IMF considers the move a critical part of modernizing the World War Two-era institution, and it would recognize the swift rise in emerging Asian economies.
Analysts and IMF officials say the IMF will become ineffective and lose legitimacy if it fails to reform.
– We expect that this work of the Board will continue in coming days with the aim of reaching an agreement on a package by the annual meeting in Singapore next month, IMF spokesman David Hawley told a regular news briefing.
The IMF board met on Wednesday to consider a two-stage plan that would see ad hoc increases in the quotas, or voting shares, of a number of the most under-represented countries.
As the Board convened, IMF Board officials told Reuters there was already broad agreement that China, South Korea, Mexico and Turkey will be the first to receive increases, although some countries favor a longer list of up to 10 countries.
The US government is backing a bigger IMF role for China heading into the global body’s annual meeting next month in Singapore, an official said.
The US is also willing to provide a small ad-hoc increase to the four countries that are underweight in every variable of the current quota calculations. China, South Korea, Turkey and Mexico as part of a first step toward broader IMF reform.
Kilde: www.worldbank.org
