‘Asia deserves bigger role in IMF’

Singapore, September 13 :

Asia deserves a bigger role in the International Monetary Fund (IMF) to reflect its growing

contribution to the global economy, Singapore’s former prime minister said today.

“Asia contributes to about a quarter of the world’s gross domestic product (GDP), but

Asia only has about 10 per cent of the votes. This is Asia excluding Japan,” Goh Chok Tong

said in an interview with The Straits Times. “So I think it’s right that it should give countries like China and Korea more voting rights, and of course Turkey as well as Mexico.”

Goh now holds the rank of senior minister in the government and is chairman of the Monetary Authority of Singapore, the de facto central bank. He was speaking ahead of the September 19-20 annual meetings of the IMF and World Bank in Singapore.

At the meeting, the 184-member IMF is expected to adopt a preliminary overhaul of its voting system to better reflect the economic emergence of China, South Korea, Turkey and Mexico.

The quotas conferred on IMF members determine how much they contribute to the Fund, their voting rights and access to financing.

The quotas largely date from a system enacted at the IMF’s creation in 1945.

While calling for a bigger voice for Asia, Goh said countries seeking a greater role in the IMF must be prepared to increase their financial contribution to the institution.

Among the countries wanting a bigger say is Singapore, Southeast Asia’s most advanced economy and one of Asia’s wealthiest nations, Goh said. He added that the city-state is willing to contribute more to the Fund.

“Before we can have more voting rights, we must be prepared to contribute to the increase in quotas,” he said.

The Washington-based lending institution was established to help prevent and manage

financial crises when they arise globally.

During the Asian financial crisis that struck in 1997, the IMF arranged bailout funds for affected countries.

It was heavily criticised at the time in some countries for the manner in which it prescribed reform policies which gave recipients little say in how they were implemented.

IMF to press China :

LONDON: China will come under pressure from the IMF this weekend to speed up the appreciation of its currency amid growing fears that global economic imbalances pose an imminent threat to prosperity.

The IMF expressed renewed concern that the strength of financial markets could be put at risk over the coming months, and its managing director, Rodrigo de Rato, believes that a higher value for the Chinese yuan is a crucial ingredient in averting a hard landing. — The Guardian

National financial regulator :

BEIJING: China plans to set up an agency to link regulatory efforts by the central bank, market watchdogs and other monitors. Such an agency would be meant to respond to changes in China’s evolving financial industry, vice-finance minister Li Yong said.

“We are trying to set up a financial supervisory coordinating system between the central bank, fiscal department and financial regulators,” Li said. He didn’t say what form the new body would take. — AP