Bric FMs demand IMF quota shift to emerging economies

Hours ahead of the G-20 finance ministers’ meet in London tomorrow, the representatives of the Bric nations (Brazil, Russia, India and China) today said they were willing to commit a total of $80 billion to the International Monetary Fund and the World Bank, but also demanded a substantial shift of quotas and shares in favour of emerging markets — 7 per cent in IMF and 6 per cent in World Bank — by doubling from the current levels.

“For IMF and World Bank Group, the main governance problem, which severely undermines their legitimacy, is the unfair distribution of quotas, shares and voting power. Priority should be given to a substantial shift of quotas and shares in favour of emerging market and developing countries,” the Bric nations said in a communique issued here today.

After the April 2009 meeting of leaders of G-20 nations, the finance ministers of these countries will meet here tomorrow to take stock of the world economic situation and agree on the future course of action to maintain the momentum of exit from a two-year global recession. The meeting will culminate in the G-20 Nations’ leaders meet in Pittsburgh, United States on September 24 and 25.

The Bric finance ministers also agreed that the the world has overcome its most serious economic crisis since the 1930 Great Depression and many of the G-20 members are on the way to a complete recovery.

Of the $80 billion of funding committed by these four countries to IMF and World Bank, India will contribute $10 billion, said its finance minister, Pranab Mukherjee. China, with a commitment to pump in $50 billion to IMF and World Bank, will the largest contributor from this group.

Meanwhile, Mukherjee said he was hopeful of 6-7 per cent growth in 2009 and 2010. He said India would continue its domestic fiscal support of 3-4 per cent of GDP through 2008-09 and 2009-10.