Friday, September 10, 2010
U.S. Pressures I.M.F. to expand the role of Growing Economies
The United States has pushed to expand the influence of the International Monetary Fund over economies that are growing or on the path of economic recovery. The I.M.F. has taken a more prominent economic role during the recent financial crisis by increase their lending committments throughout the world from $2 billion to close to $195 billion. The plan to expand the role has seen criticism from many European countries, which are believed to be overrepresented on the I.M.F board. The shift in power will see a shift in power towards other fast growing developing economies. Those in the United States believe that this change will lead to a more multilateral I.M.F. to represent the changes in the economic world today. Do you think this reform of the structure of the I.M.F. will succeed? Do you believe the United States, which is the most powerful nation in the I.M.F. has too much influence and power to push for such a reform?
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2 comments:
I agree with the article on the extent that European economies are definitely overrepresented in the IMF and developing countries are not. In that aspect it would be a good idea to include more representatives from those developing nations. However, it does seem that the U.S. is pushing for this foreign involvement because of the fact that China is becoming a very powerful economy and not necessarily because it wants to include other fast growing nations. As far as the European countries go, they have always been relatively exclusive so this backlash is hardly surprising.
I believe this reform will succeed because, like Lombardi said in the article, the structure change was inevitable; and no matter how much influence the US has over this reform, it is a necessary one.
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