Monday, November 28, 2011

IMF and Latin America

So let's get this straight. European governments want Latin America (and the BRICS countries more broadly) to cough up hundreds of millions of dollars to the IMF to prop up Europe. However, they refuse to give those countries any more influence in the IMF.

Now, as their economic weight increases, Brazil and the other so-called BRICS nations of Russia, India, China and South Africa, want reassurances that the IMF will push ahead with changes to quotas, which determine a member country’s voting rights and access to IMF funding. 
“We want to know the plans for the next steps in the IMF governance reform, which is the discussion on the formula for calculating quotas,” Carlos Cozendey, the Brazilian Finance Ministry’s international affairs secretary, said by phone. 
With many European countries still hesitant to yield power at the IMF, Lagarde will be unlikely to make specific pledges in her meetings with the presidents and economic officials of the three countries.

Remember that Agustín Carstens had been pushed for the IMF position but lost. I would expect some hardball, though it might be almost entirely behind closed doors. Maybe a pledge of money now, with announcement of some sort of reforms in coming months?


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