IMF Stepping Up Focus on Global Systemic Stability

Strauss-Kahn says IMF reform package near completion

Some divergent views, but “I think we are on the right track”

IMFC says action needed to improve surveillance, policy collaboration

At the end of a meeting of the IMF’s policy steering committee, the Managing Director expressed optimism about completing a series of reforms that will make the IMF more reflective of the new global economy by increasing the say in the institution of the dynamic emerging markets now leading the world out of recession.

“We have gone extensively into reform of the IMF—quotas, governance with all its components, the composition and size of the Executive Board,” said Youssef Boutros-Ghali, the Egyptian Finance Minister who is head of the International Monetary and Financial Committee (IMFC) of the Fund.

“There has been extensive progress. All of the parties involved are converging toward a package that we think will move the institution toward a new level, make it more adaptable and capable of dealing with the problems that have become multilateral in most of their features,” Boutros-Ghali said.

The meeting was part of the IMF-World Bank Annual Meetings in Washington that have gathered around 10,000 central bankers, ministers of finance and development, private sector executives, labor leaders, civil society representatives, and academics to discuss issues of global concern, including the world economic outlook, poverty eradication, economic development, and aid effectiveness.

Uneven global recovery

In a communiqué, the IMFC said that the economic recovery around the world was proceeding, but remains fragile and uneven across the membership.

“Faced with this source of potential stress, we underscore our strong commitment to continue working collaboratively to secure strong, sustainable, and balanced growth and to refrain from policy actions that would detract from this shared goal,” the communiqué said.

Ministers said their priorities were to address remaining financial sector fragilities; ensure strong growth in private sector demand and job creation; secure sound public finances and debt sustainability; work toward a more balanced pattern of global growth, recognizing the responsibilities of surplus and deficit countries; and address the challenges of large and volatile capital movements, which can be disruptive.

They said rejection of protectionism in all its forms must remain a key element of a coordinated response to the crisis and renewed efforts...