IMF to finalise second round of quota reforms by year-end

IMF today said that it would finalise the second round of quota reforms by the end of the year, while the World Bank has only completed the first round.

“What the World Bank did two months ago is something that we did two years ago. Now, we are taking one more step,” IMF Managing Director Dominque Strauss-Kahn said today.

The group of 20 economic powers, or G-20, has asked IMF to finalise a plan for increase in the say that developing countries have by the time it meets in Seoul in November. While developing countries are demanding a greater say, developed countries, led by European ones, have put up roadblocks resulting in the lack of understanding on the formula for reworking the quotas.

Countries such as India are critical about IMF dragging its feet over the quota changes and had flagged the issue at the last G-20 meeting in Toronto. The leadership had then decided to seek finalisation of the scheme by the time they met in Seoul in November instead of the earlier deadline of January 2011.

Earlier this year, the World Bank had agreed to increase the voting rights of developing and transition countries by 3.13 per cent, with the share of India rising from 2.77 per cent to 2.91 per cent. China’s quotas rose to 4.42 per cent from 2.77 per cent.