The US supports a plan for the International Monetary Fund (IMF) to sell part of its gold reserves to shore up the multilateral institutions finances, the Treasurys Undersecretary for International Affairs said.
David McCormick said the Bush administration sees the proposed sale of 12,9 million ounces of gold as “probably the most viable” option to ensure the long-term funding of the IMF. Proceeds would be used for an interest-bearing endowment.
The sale, which the US Congress also must approve, must be accompanied by cuts in the Fund’s budget and changes in its governance to give more influence to emerging countries and perhaps less to Europe, said McCormick.
He further called for the Fund to reduce the number of executive board members to 20, from 24, and to make room within the 20 for developing countries.
The call marks an effort to renew the momentum for reform of the IMF. McCormick pressed the IMF to make use of its recently enhanced mandate to monitor exchange rates more aggressively.
He also called on the IMF to make “meeting the unique challenges posed by sovereign wealth funds a second priority.
McCormick said the other core responsibility of the IMF was to promote financial stability, highlighting its role in conducting regular stress tests of countries financial systems.
Kilde: www.worldbank.org
