G7 calls for 'serious' IMF reforms

WASHINGTON: The International Monetary Fund (IMF) needs a major overhaul that curbs spending and gives poor and emerging nations a greater say in decision-making, finance officials from the seven leading industrial nations said.
 
The draft statement by the Group of Seven (G7) officials was in line with reform goals outlined by former French finance minister Dominique Strauss-Kahn, who takes the helm of the 185-nation lending agency on November 1.
 
"We remain committed to achieving an ambitious package of fundamental reforms," said Friday's interim statement from the G7 group, which met in Washington on the eve of the autumn meetings of the IMF and the World Bank.
 
However, no breakthrough on long-running disputes over a new power-sharing formula at the IMF and the World Bank was expected at the weekend meetings of the two institutions.
 
The Washington-based agency, often criticised for imposing stringent market reforms in return for emergency financial aid to struggling governments, has increasingly lost customers - and interest income - as nations turn to other sources of finance.
 
IMF finances must be put on a sustainable footing, but the fund also 'must undertake a serious review of its activities and consolidation of its spending', the officials said.
 
Voting power among IMF member nations 'should better reflect the realities of the world economy', they said, referring to the growing economic heft of countries like China, Brazil and India.
 
"We also agreed that the voice of low income countries should be enhanced," the G7 officials said.