The Ministers of Finance and heads of Central banks of G20 at a meeting in Washington from 14 to 16 April will start discussions on the revision of the formula for the allocation of quotas in the International monetary Fund (IMF) and the 15th review of quotas, reported the Agency “Interfax” a source in the Russian delegation.
“It is clear that begins the discussion on the revision of the quota formula in the IMF and the assessment of capital adequacy Fund,” he said, commenting on the agenda of upcoming meetings.
Earlier at a meeting in Shanghai in February 2016 theme changes the formula for the allocation of quotas and the 15th review of quotas has been raised, however, as noted then, a source in the Russian delegation, the participants reacted to this “with skepticism”. “No one is willing to move anywhere especially. Americans don’t even hide the position that they are not ready soon to go to Congress with a new ratification. Europeans, too, there’s no hurry. While to speak about something prematurely, the Fund no bids were prepared,” explained he.
tablet, 14th quota review took considerably longer than planned, as the U.S. for several years could not ratify it in Congress, which approved in 2010 by the leaders of the “twenty” in Seoul the time of development of a new formula (by January 2013) and on the basis of a new formula of the 15th review of quotas (January 2014) have not been sustained. To ratify the 14th review is 2012 only in December 2015. In this revision, the total size of the quota is doubled with 238,4 billion SDR to 476,8 billion SDR, in addition, more than six percent of quota reallocated from developed to developing countries. In the end, China will become the third largest state quotas – a member of the IMF, while Brazil, India, China and Russia are among the ten largest shareholders of the Fund. The completion of this stage gives the opportunity to initiate a discussion on further steps in the reform of the Fund and to launch the debate on the new quota formula.
“In Shanghai have agreed in which direction we move on. Now there are the first documents, including from the IMF itself, which might provide the basis for discussion on the “twenty”, – said the Agency interlocutor. He noted, however, that to expect any specific agreement on this subject is not worth it.
Overall, the meeting of G20 Finance Ministers, the source said, will be “compact enough”, not all issues that are traditionally included in the agenda will be discussed at the Ministerial level.
The source also reported that China is presiding over the G20 this year, is promoting the theme of expanding the use of SDR, will discuss it at the meeting in Washington.
In addition to this financial “the twenty” will discuss the topic of sovereign debt. However, as the source noted, offered the BRICS a more radical approach to sovereign debt and its restructuring recommendations, which may be the work on sovereign debt – has not yet been endorsed by the G20. “While most countries are not prepared in this format to discuss it. Moreover, the famous settlement of Argentina’s debt (which, along with the BRICS have pushed forward the development of recommendations – if) in February, has brought this country from among the active supporters of the more radical approaches to sovereign debt, so now they are not so active in discussing this topic,” – said the Agency interlocutor.
“Twenty” can also affect the cooperation between the IMF and regional financial arrangements, which arose in the year of Russia’s presidency. “In 2013 this theme was actively discussed and formulated some principles of such cooperation, but concrete, measurable steps with none of the parties has not been undertaken. And now the second attempt the results of the discussion to try to implement in what is already a practical way to introduce more permanent regular mechanism of interaction and coordination between the Fund and other entities operating in different regions of the world,” he explained.
In addition to the meetings of the G20 these days in Washington will host a meeting of Finance Ministers of the BRICS meeting of the Board of governors of the New development Bank, as well as activities in the framework of the spring session of the IMF and the world Bank.
BRICS Ministers will exchange opinions on the proposals of India, the presidency of which recently began. So, India offers to discuss the issue of proactive budgeting. “It’s about the formation of certain approaches from the viewpoint of greater flexibility to manage the budget directly on the ground, from the perspective of greater involvement of local and regional authorities and the population, in the process of budget planning and execution. While the theme is announced, no specific proposals on how BRICS countries could come to the leaders summit. Whether this will result in a full-scale initiative or a serious this is the theme for exchange of views, see,” – said the Agency interlocutor.
