APEC wants IMF overhaul

FE Team | Published: August 03, 2007 00:00:00 | Updated: February 01, 2018 00:00:00

COOLUM, Australia, Aug 2 (AFP): Finance ministers from the Asia-Pacific region want the International Monetary Fund (IMF) to be overhauled, Australian Treasurer Peter Costello said today.
The 21 Asia-Pacific Economic Cooperation (APEC) forum finance ministers currently meeting in Australia had all agreed that the IMF should be reformed to make it more relevant, Costello said.
"There is a view in the Asia-Pacific that the IMF is not fully representative of the modern economy and there's a broad consensus that the IMF needs reform and needs a better focus on this region," Costello told reporters.
"Countries in this region are emerging as great economic powers and they are going to be critical to the global economy in the years ahead.
"I think the IMF reflects an economic order as it stood at the end of World War II, not the economic order as it stands at the end of the 21st Century."
The IMF has been criticised recently over a "gentleman's agreement" between Europe and the United States allowing Brussels to pick the IMF chief and Washington to select the head of the World Bank.
Former French finance minister Dominique Strauss-Kahn is currently the sole candidate to take over from Rodrigo Rato as the fund's managing director. He has pledged to reform the institution.
The IMF was formed in 1944 to oversee the international monetary system, including exchange rates, and to provide temporary finance to countries struggling with balance of payments problems.
The fund's deputy managing director, John Lipsky, defended the organisation. He said it was reforming its membership structure and that its existence had coincided with strong global growth.
"The period since the formation of the IMF ... has been a period of some of the most sustained economic advance in the history of the world," he said.
"I'm not trying to claim it's because of the IMF but it's hard to say that that's a sign of failure or irrelevance."
Lipsky said the amount the IMF had loaned to struggling countries had declined in recent years but that it remained an important back-up for the international financial system.