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IMF leaders back shake-up plans | IMF leaders back shake-up plans |
(about 4 hours later) | |
Leading members of the International Money Fund have agreed unanimously to back proposed reforms giving more IMF voting rights to emerging economies. | Leading members of the International Money Fund have agreed unanimously to back proposed reforms giving more IMF voting rights to emerging economies. |
The IMF does not have "a one member one vote" constitution, but voting power is linked to economic criteria. | The IMF does not have "a one member one vote" constitution, but voting power is linked to economic criteria. |
The IMF's 184 members are voting on a proposal to change voting - which would immediately increase the votes of China, South Korea, Turkey and Mexico. | The IMF's 184 members are voting on a proposal to change voting - which would immediately increase the votes of China, South Korea, Turkey and Mexico. |
Now its top steering committee, chaired by Gordon Brown, has backed the move. | Now its top steering committee, chaired by Gordon Brown, has backed the move. |
Mr Brown described the move as the biggest shake-up of the IMF in six decades. | Mr Brown described the move as the biggest shake-up of the IMF in six decades. |
"We welcome today's agreement to a comprehensive reform package for [voting] quotas which, if moved forward, we want to be completed no later than the 2008 annual meetings," the UK chancellor said. | "We welcome today's agreement to a comprehensive reform package for [voting] quotas which, if moved forward, we want to be completed no later than the 2008 annual meetings," the UK chancellor said. |
"These reforms we agreed should also enhance the participation and voice of low income countries in the IMF." | "These reforms we agreed should also enhance the participation and voice of low income countries in the IMF." |
Two-stage plan | Two-stage plan |
The IMF's 24-strong International Monetary and Financial Committee is meeting in Singapore. The proposal needs to win 85% of votes to pass. The voting deadline is Monday afternoon, and results will be announced after that. | The IMF's 24-strong International Monetary and Financial Committee is meeting in Singapore. The proposal needs to win 85% of votes to pass. The voting deadline is Monday afternoon, and results will be announced after that. |
Votes are currently weighted partly in line with financial contributions to the IMF, which in turn is related to the size of the country's economy. | Votes are currently weighted partly in line with financial contributions to the IMF, which in turn is related to the size of the country's economy. |
The first stage of change is the immediate recalculation of the votes allocated to China, South Korea, Turkey and Mexico. The second stage would be a review of how votes are calculated with further changes based on some new formula. | The first stage of change is the immediate recalculation of the votes allocated to China, South Korea, Turkey and Mexico. The second stage would be a review of how votes are calculated with further changes based on some new formula. |
However not all emerging nations are behind the new proposals, with Argentina and Brazil wanting to see their voting share increased quickly too. | However not all emerging nations are behind the new proposals, with Argentina and Brazil wanting to see their voting share increased quickly too. |
And India believes the fund should overhaul the system in one step, not in the proposed two steps which are being voted on now. | And India believes the fund should overhaul the system in one step, not in the proposed two steps which are being voted on now. |
The US vote at the IMF counts for about 17% of the total, and Japan has 6.1% of the vote. Argentina has a voting share of 0.99%, and Swaziland has 0.03% of the vote. | The US vote at the IMF counts for about 17% of the total, and Japan has 6.1% of the vote. Argentina has a voting share of 0.99%, and Swaziland has 0.03% of the vote. |
Indian opposition | Indian opposition |
Meanwhile, there were further positive noises about restarting stalled global trade talks. | Meanwhile, there were further positive noises about restarting stalled global trade talks. |
Mr Brown said he was optimistic about breaking the Doha round deadlock, after US Treasury Secretary Henry Paulson said the US remained "fully committed to achieving a successful outcome". | Mr Brown said he was optimistic about breaking the Doha round deadlock, after US Treasury Secretary Henry Paulson said the US remained "fully committed to achieving a successful outcome". |
Mr Brown also said he believed Pascal Lamy, director-general of the World Trade Organization, would be able to make progress on a deal by the end of the year to remove barriers to global trade. | Mr Brown also said he believed Pascal Lamy, director-general of the World Trade Organization, would be able to make progress on a deal by the end of the year to remove barriers to global trade. |
But Indian Commerce Minister Kamal Nath said his country's rural economy was too precarious for the country to consider opening up its market further to imports of farm goods. | |
"There is no question of India making concessions at all where agriculture is concerned because our issue is subsistence," Mr Nath said. | "There is no question of India making concessions at all where agriculture is concerned because our issue is subsistence," Mr Nath said. |
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