BRIC nations say no IMF cash without representation
Putting order in the house...
"We will only agree to increase capital to the IMF after the reform of the (IMF) quotas is carried out, because there is still a imbalance in our participation in the IMF," Brazil's Mantega said.
HORSHAM, England, March 13 (Reuters) - Brazil, Russia, China and India will contribute no extra money to the International Monetary Fund until they have bolstered their voting power at the agency, Brazil's finance minister said on Friday.
Meanwhile Russia's finance minister, Alexei Kudrin, said he expected the Financial Stability Forum (FSF) would be expanded before leaders of the G20 economic powers meet on April 2 -- a move that would achieve part of the BRIC nations' goals in gaining a greater say in global financial decision-making.
Kudrin and Brazil's Guido Mantega were speaking after a meeting of policymakers from the four major emerging economies, held on the sidelines of a gathering of central bankers and finance ministers from the G20 old and new economic powers.
"We will only agree to increase capital to the IMF after the reform of the (IMF) quotas is carried out, because there is still a imbalance in our participation in the IMF," Brazil's Mantega said.
Kudrin said the BRICs were ready for bolder reforms of the global financial architecture than other countries and had a common position on most "sensitive" issues.
One of the few areas of consensus emerging from the G20 meeting, taking place in southern England on Friday and Saturday to lay the groundwork for the April 2 summit, has been on the need to double the IMF's resources to $500 billion to strengthen its ability to help developing nations facing funding crises during the global downturn.
Japan has offered $100 billion and the European Union is considering a loan to the IMF of $100 billion, leaving a shortfall of $50 billion.
There have been calls on China, which has the world's largest foreign currency reserves at $2 trillion, to help make up the amount.
Mantega said he did not think there would be agreement on reforming voting rights at the IMF, which is dominated by Europe and the United States, at April's meeting of G20 leaders.
"I don't see a possibility of the representation of the G20 changing now," Mantega said. "In April, no; in October it is possible."
The slim representation of developing countries in international decision-making forums has been a gripe for years. Calls for change have grown with the global crisis, especially since the IMF's largest and most powerful shareholder, the United States, is the epicentre of the financial upheaval.
Brazil's finance minister said the most pressing problem facing global leaders is how to rid banks of the toxic assets that are undermining bank balance sheets and crippling lending.
"This is key to restoring the world economy to health," Mantega said. He urged the United States to accelerate a resolution of banking system problems.
Kudrin said BRIC countries on the whole supported fiscal stimulus measures but added: "We will be very cautious putting any numbers to it." He told a news conference that Russia's fiscal stimulus package exceeded 5.5 percent of the GDP, well ahead of a 2 percent minimum promoted by the United States.
Kudrin also cast doubt on the G20's ability to stop protectionist responses to the global downturn. "Protectionism is a special question, different from all the other questions. It (the decision) will be difficult to implement," he said.
Russia is one of several G20 countries that have been accused of taking protectionist measures after the group promised at a November summit not to raise trade barriers over the next 12 months.
(Editing by Ruth Pitchford) |
