IMF votes to shift more power to emerging economies

WASHINGTON, (Reuters) – The International   Monetary Fund said on Thursday that its board of   governors had approved reforms that will shift more voting   power to emerging-market countries like China.   

“It will result in a shift of more than six percent of   quota shares to dynamic emerging market and developing   countries and more than six percent from over-represented to   under-represented countries,” the IMF said in a statement.   

Voting share in the global lender is important because it   gives countries a chance to influence decisions about how   money, raised through subscriptions from IMF members, is used.   
The IMF said the 10 IMF members with the largest voting   share in future will be the United States, Japan, the key   emerging-market powers of China, Brazil, India and Russia as   well as France, Germany, Italy and Britain.   

By giving more voting power to countries like China and   other emerging powers, “this reform will result in a Fund that   better reflects realities,” the IMF said.   

Developed countries have stepped up efforts to have   countries like China accept greater responsibility in global   councils like the IMF while Beijing has chafed at contributing   more unless its rising economic heft is recognized.   

Emerging economies already have gained more clout in the   IMF over the past five years, but the shift in voting power   effectively amounts to a major overhaul of the global economic   order established when the IMF was set up after World War Two.   

The IMF said the changes will strengthen the lending   institution’s “legitimacy and effectiveness.” The changes also   double IMF member quotas, or subscriptions, boosting the   lender’s resources by about $733.9 billion at current exchange   rates, the fund said.   

The next step is for member countries to accept the   proposed quota increases — which in some cases will require   parliamentary approval. The IMF said its members “will make   best efforts to complete this” by October 2012.

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