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 Finance ministers gathering in Washington this weekend for the
twice-yearly meetings of the IMF are set to debate a handful of ad
hoc measures to achieve at least some of the 2010 governance
overhaul for the global lender without a formal U.S. approval.
Last month, Democrats in the U.S. Senate dropped an effort to
include the reforms as part of an aid package for Ukraine because
the Republican-led House of Representatives refused to consider the
matter.
Frustrated by the U.S. foot-dragging, international finance
officials are bandying about a clutch of alternatives.
These include proceeding with an ad hoc increase in the voting share
of emerging economies, which like the formal reforms would reduce
the U.S. voting weight, and a more drastic proposal to refuse to
extend the IMF's emergency borrowing authority, Australian Treasury
Secretary Martin Parkinson said.
The options will be debated at a meeting of the IMF steering
committee and the top 20 economies on Friday.
"They are all legitimate options," Parkinson said ahead of the start
of the meetings.
Still, Parkinson and others say that a likely outcome is to just
give the United States more time.
"It would be a mistake not to give the United States the opportunity
to get it done," Mexican Finance Minister Luis Videgaray said in an
interview.
Videgaray said there would be a window for the U.S. Congress to pass
reforms increasing funding and widening representation at the IMF
following U.S. midterm elections in November.
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The United States has faced backlash from other countries over the
refusal to approve the reforms, particularly from emerging economy
countries whose voting share at the IMF would increase under the
overhaul.
"I think failure to deliver the 2010 IMF reform is a serious damage
to the G20 leadership," People's Bank of China Vice Governor Yi Gang
said. "And I think failure to deliver this reform ... is a threat to
IMF legitimacy."
"It creates some uncertainty for the future resources of the IMF,"
Yi said at a conference in Washington ahead of the spring meetings.
The governance reforms were adopted by the IMF in 2010, and
initially a deadline of the end of 2012 had been set for all member
countries to endorse them. The administration of U.S. President
Barack Obama has so far been unable to persuade Republicans in the
House to act on the measure.
Many Republican lawmakers complain that the reforms would cost too
much at a time the United States is facing high deficits and budget
cuts, and would lessen U.S. influence at the IMF.
(Reporting by Anna Yukhananov, Krista Hughes and David Brunnstrom;
writing by Dan Burns; editing by Mohammad Zargham)
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