Emerging markets should have more say on who is next boss, urges policy committee member
Reuters in Beijing 25 May 2011
The United States should reduce its dominant voting share in the International Monetary Fund, an adviser to the People’s Bank of China said yesterday, helping to give emerging economies more of a say in deciding who will take the helm of the IMF.
Xia Bin, who sits on the central bank’s monetary policy committee, said reform of the IMF could not make significant progress unless the US is willing to give up its dominant voting share in favour of developing countries.
“It’s not an issue of who will be the candidate for the IMF managing director. The problem is that the voting share of the United States is too big,” he said.
Within China, the PBOC is one of the dominant voices influencing the government’s stance on IMF-related matters. French Finance Minister Christine Lagarde has emerged as a front runner to succeed former managing director Dominique Strauss-Kahn, but developing economies, with growing global clout, are keeping pressure on Europe and the US to preclude a back-room deal.
“The voice of emerging-market economies should be heard, but emerging markets must realise that reform of the global monetary systems is a long process,” Xia said.
The voting shares reflect the relative size of countries’ economies. In November, the IMF agreed to boost the voting power of big emerging economies, enabling China to leapfrog Germany, France and Britain.
Its quota share rose to 6.19 per cent from 3.65 per cent.
Under the latest adjustments, the US remains the IMF’s most powerful member with 17.67 per cent of the overall quota, effectively giving it veto power at the fund.
Xia said he hopes a candidate from the mainland could compete for the IMF job, but added that it’s unrealistic to expect China to play a big role in IMF policy decisions any time soon. Indeed, China is likely to exercise its growing clout within the IMF judiciously, said a PBOC source.
“China is the second-largest economy in the world and our influence is increasing. So we must not make choices randomly and any decision must be taken cautiously and responsibly,” said the source.
1 comment:
Cut US voting share on IMF, says PBOC adviser
Emerging markets should have more say on who is next boss, urges policy committee member
Reuters in Beijing
25 May 2011
The United States should reduce its dominant voting share in the International Monetary Fund, an adviser to the People’s Bank of China said yesterday, helping to give emerging economies more of a say in deciding who will take the helm of the IMF.
Xia Bin, who sits on the central bank’s monetary policy committee, said reform of the IMF could not make significant progress unless the US is willing to give up its dominant voting share in favour of developing countries.
“It’s not an issue of who will be the candidate for the IMF managing director. The problem is that the voting share of the United States is too big,” he said.
Within China, the PBOC is one of the dominant voices influencing the government’s stance on IMF-related matters. French Finance Minister Christine Lagarde has emerged as a front runner to succeed former managing director Dominique Strauss-Kahn, but developing economies, with growing global clout, are keeping pressure on Europe and the US to preclude a back-room deal.
“The voice of emerging-market economies should be heard, but emerging markets must realise that reform of the global monetary systems is a long process,” Xia said.
The voting shares reflect the relative size of countries’ economies. In November, the IMF agreed to boost the voting power of big emerging economies, enabling China to leapfrog Germany, France and Britain.
Its quota share rose to 6.19 per cent from 3.65 per cent.
Under the latest adjustments, the US remains the IMF’s most powerful member with 17.67 per cent of the overall quota, effectively giving it veto power at the fund.
Xia said he hopes a candidate from the mainland could compete for the IMF job, but added that it’s unrealistic to expect China to play a big role in IMF policy decisions any time soon. Indeed, China is likely to exercise its growing clout within the IMF judiciously, said a PBOC source.
“China is the second-largest economy in the world and our influence is increasing. So we must not make choices randomly and any decision must be taken cautiously and responsibly,” said the source.
Post a Comment