IMF closer to passing reforms

The International Monetary Fund said yesterday member countries were moving closer to authorizing voting reforms agreed to in 2010 to reflect a shift in global power away from developed countries. Emerging economies have been frustrated by the slow pace of enacting changes at the global lender that would move China into the third spot on the list of IMF voters and give more say to countries like Brazil and Russia. But it is unlikely member countries will meet their deadline to sign off on the reforms before the October meeting of the IMF and World Bank in Tokyo. Following a board meeting to review progress, the IMF said enough members had agreed to reforms that would double the number of IMF quotas, or membership subscriptions. The quotas determine how much each country contributes to the IMF and how much it may borrow from it. But some countries — including the IMF’s largest shareholder, the US — have still not agreed to the whole package of reforms, which also include changes in the make-up of the IMF’s 24-member board. “I welcome the significant progress thus far toward implementing these important quota and governance reforms, and urge remaining countries to complete the necessary steps quickly,” IMF Managing Director Christine Lagarde said in a statement, cited by Reuters. The final changes cannot go through without the support of the US, which holds 17.69 percent of the voting power. But the US Congress must approve the changes, as they require additional funding for the IMF, and it is highly unlikely to do so before the November presidential and congressional elections. As of Monday, 124 IMF member nations, with 73.4 percent of quota shares, had agreed to their proposed quota increases, meeting the 70 percent threshold required for acceptance. Arabnews