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US should ratify IMF quota reforms quickly: IMF, Treasury
[WASHINGTON] The International Monetary Fund and the US Treasury said on Thursday the United States should quickly adopt reforms to give emerging markets a bigger say at the international lender.
Plans agreed in 2010 to give emerging markets more voting power and double the Fund's resources have been delayed by the fact the US Congress has not approved the change.
IMF spokesman Gerry Rice said the executive board would discuss options on interim steps later this month, after Congress missed a Sept 15 deadline to ratify the reforms. "We continue to urge countries that have not ratified the 2010 reforms, and in particular the United States, to do so as soon as possible," he said. "We believe that adoption of these reforms is in the interests of all our member countries." Nathan Sheets, the Treasury's top official for international affairs, said the delay in approving reforms had led other countries to question the United States' commitment to international institutions.
In prepared remarks for a hearing in the US House of Representatives, Sheets said the reforms would preserve the US veto over IMF decisions and not increase its financial commitment to the Fund. "To ensure that the IMF remains at the center of the multilateral economic system - and that we maintain an important voice in it - the United States should promptly approve the 2010 quota and governance reforms," he said. "Our interest in strengthening the Fund is not based on esoteric notions of global leadership or nostalgia for institutions that the United States created. Rather, we have learned from hard-won experience that a well-resourced and effective IMF is indispensable to achieving our economic and national security interests," Mr Sheets said.
Interim options include increasing the quota for key emerging economies without requiring any change in the US position, a route some on the IMF board are warming to.
Rakesh Mohan, the IMF's executive director for Bangladesh, Bhutan, India and Sri Lanka, told Reuters on Sept 4 he saw "more and more likelihood" of an ad hoc increase.
Still, countries including Brazil have not yet given up hope of a full reform. Taking interim steps would reduce pressure on Congress to approve the full reforms.