Brdo, 07/04/2008 (Agence Europe) - At their meeting in Brdo, Slovenia, EU finance ministers agreed on a common position endorsing the planned reform of quotas and voice in the International Monetary Fund (IMF). Member states fully back this reform, which will make it possible to increase the IMF's legitimacy through fairer and more balanced representation of all countries, commented Slovenia's finance minister, Andrej Bajuk, on Saturday 5 April.
A joint statement to be presented by the Slovenian finance minister at the spring IMF Summit in Washington on 12 and 13 April comments that 'the content of the reform is a compromise that required flexibility from all sides,' including EU members, which 'made substantial concessions.' 'EU members are the main contributors to the reform in terms of the shift of voting shares, including through voluntary foregoing of quotas shares,' adds the document. The planned voting rights reform would mean 'low income countries will benefit from the marked increase in basis votes, which will lead to an increase in their voting power,' equivalent to 1.6% for emerging economies and developing countries. Overall, EU member states will have their voting rights reduced by around 1%, but not all member states are treated equally. The United Kingdom, France, the Netherlands and Belgium are among the countries that will lose the most (along with Saudi Arabia, Canada, Russia, the United States, Switzerland and Australia), whereas Spain and Ireland are among the countries which will have greater say (China, South Korea, India and Brazil are at the top of the list, along with Singapore, Turkey and Japan). In its statement, the EU27 emphasised 'the need to establish an integrated budgetary framework to ensure the independence of the IMF and its ability to fulfil its mission as set out in the Medium Term Strategy. This implies a simultaneous decision on the income model and on expenditure.' They recommend strengthening the IMF's role in monitoring the financial industry and how it meshes with the real economy. Unveiled on 28 March 2008, the reform package is being submitted to the Council of Governors for approval. It will need to be approved by the end of March 2008 by 60% of the 185 IMF member states representing at least 85% of voting rights. (A.B.)