Lack of reform weakens IMF, Turkish Deputy PM says

MOSCOW – Hürriyet

Turkish Deputy Prime Minister Ali Babacan says no steps have been taken for crucial reforms in the IMF, noting that it was weakening the institution. AA photo

Turkish Deputy Prime Minister Ali Babacan said no steps had been taken for quota and governance reforms in the International Monetary Fund (IMF), noting that it was weakening the institution, on July 20 during the G-20 summit held in Moscow.

Babacan stated that the 2010 Quota and Managing Reform was a very important step for enhancing the IMF’s representativeness and legitimacy but that there weren’t any hopeful developments in practice. Even though it was promised in April, it is disappointing that they could not reach any compromise on the main factors of the new quota formula, he said. Also this situation put the reliability of the G-20 at risk, he said, adding that he had strong expectations to reach an agreement on the subject at the next meeting in October.

Under the terms of a quota and governance reform launched in 2010, the IMF executive board had until the end of January to review the quota formula that determines the voting power of its 188 members.

The emerging-market and developing economies have for years demanded recognition of their increased importance in the global economy in the voting structure of the Washington-based institution.