The International Monetary Fund (IMF)’s board of directors plans to approve authorisation to issue as much as $150 billion of bonds for the first time as it seeks new sources of funds, an IMF official said.
The board is scheduled to vote on the matter today, the official said on condition of anonymity. The bonds are part of a wider effort to seek new funding as the lender helps countries from Iceland to Pakistan combat the global financial crisis.
The securities, the culmination of months of talks between the fund and its members, will offer the largest emerging-market nations a new way of making IMF contributions while they seek a greater say at IMF.
China, Brazil and Russia have favored the bonds instead of regular contributions as they wrangle with other members over redistributing the IMF’s voting power.
“The emerging market economies want to call the shots a little bit more,” said Simon Johnson, a former chief economist at the IMF who is now a senior fellow at the Peterson Institute for International Economics in Washington. “It’s all part of a longer evolution of the IMF.”
Leaders from the Group of 20 industrial and emerging nations agreed in April to boost IMF coffers by $750 billion to help the Washington-based agency shore up nations roiled by the credit crunch.
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