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IMF to embrace change: British Minister

Written by: Staff
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SINGAPORE, Sep 17: Defying critics who accuse the International Monetary Fund of not moving with the times, Britain's finance minister said on Sunday no one could argue that the 61-year-old institution was not embracing change.

Gordon Brown, who chairs the IMF's steering committee, launched a vigorous defence of the fund, although he acknowledged that members differ over the degree and pace of reform.

''Some people say we've been moving too fast, some people say we've been moving too slowly. I suppose sclerosis means you're not moving at all, but the one thing you cannot say is there is no change,'' Brown told a news conference in Singapore, where the IMF and World Bank are meeting.

''Change is happening, reforms have been put in place,'' he said.

A communique of the International Monetary and Financial Committee (IMFC) on Sunday unanimously backed reforms to the IMF's voting power that would give emerging economies more say in the institution.

The IMFC statement urged the IMF's executive board to work ''constructively and expeditiously on all elements of the reforms so as to garner the broadest possible support''.

A SLOW-MOVING ELEPHANT

The IMF's 184 members are voting on a proposal to change its voting structure. The proposal, which must receive 85 percent backing, would immediately increase the votes of four countries -- China, South Korea, Turkey and Mexico.

A second stage, to be completed by 2008, would see further adjustments for emerging economies and poorer members.

But Brazil, Argentina, India and Egypt have argued that the package does not sufficiently address the under-representation of developing countries and the second stage is not guaranteed.

''Everyone agreed we need change but this is an elephant that moves slowly,'' Brazil's finance minister, Guido Mantega, told reporters.

''This has to diminish the status quo of European countries,'' he added of Europe's heavy influence at the IMF.

Malaysia's second finance minister, Nor Mohamed Yakcop, said he was ''disappointed'' that Malaysia and other Southeast Asian countries, which are under-represented in the fund's voting structure, were not included in the first round of adjustments.

''In the interest of consensus building, we are willing to cooperate and to wait for our turn at the second stage,'' Yakcop told the IMFC.

''Moreover, we cannot overemphasise the need for a clear political commitment, especially from advanced country members, towards making signficant progress on the second stage immediately after Singapore.'' Brown, Britain's chancellor of the exchequer, added: ''I believe that major shareholders in the IMF will approach this in a statesmanlike way because we do wish to move the institution forward.'' IMF Managing Director Rodrigo Rato said the fund would aim for as much consensus as possible as it crafted a new formula to calculate members' votes.

REUTERS

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