The International Monetary Fund on Friday warned that endorsements of its 2010 plan to double its resources remain far shy of what is necessary for approval. With two of the Fund's leading shareholders, the United States and Germany, still not having given official approval, the Fund's chief and its board both warned that the October 2012 target deadline is looming.
"I urge remaining countries to complete the necessary legislative steps and other legal measures quickly to implement this important agreement within the agreed timeframe," said managing director Christine Lagarde in a statement. That was echoed by the IMF executive board.
"With only seven months remaining on the timeline suggested by the Board of Governors, a substantial effort is needed to make the 2010 governance and quota reforms effective no later than the 2012 IMF/World Bank annual meetings," the board said. The annual meetings are scheduled on October 12-14 in Tokyo. The Fund said that neither of two essential proposed changes - the quota hike adding some $365 billion to Fund resources, and board reforms that will strengthen the role of emerging economies - were near to the thresholds of official consent needed to enact them.
The changes were agreed by leaders of the Group of 20 economic powers at a meeting in 2010 in the wake of the economic crisis that had battered the United States and Europe. But many, such as the United States, which has at 18 percent by far the largest IMF quota - require approval by their legislatures for final consent. As of March 12 only 89 of the Fund's 187 members, representing 53 percent of "quotas" or shares in the Fund, had signed off on the 2010 quota increase. Support is needed from members holding 70 percent of quotas for the boost to funding to go through.