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April 20, 2012 at 05:47 AM
The dominant emerging economies have pledged billions to the International Monetary Fund. However, those countries, and others, are growing restive at the long dominance of Europe and the U.S., and they are pushing for change that would allow them greater say in the IMF’s workings.
Reuters reported Friday that the G20 would announce enough in pledges to fulfill IMF chief Christine Lagarde’s call for $400 billion in additional funding to combat the European debt crisis. Worries over the possible need of a bailout for Spain or Italy have led to efforts to boost available funds for rescues.
Much of that money would be coming from emerging market nations such as China and Brazil, with the latter determined to extract a commitment from the IMF to provide those countries with a greater voice in governance. Brazil in particular is saying that a condition for emerging markets’ contributions should be new promises to recognize their growing world importance—and that such promises should be written into the G20 communique.
An existing agreement to lower the amount of influence Europe has at the IMF and to raise China to the third most powerful voting position there has been stalled, especially by the U.S.
