IMF seeks to renew, deepen relationship with Asia (2)

The IMF announced that it decided to shift 5 percent of its voting rights to developing countries, mostly those in Asia, from advanced economies, after which the total voting rights of Asia will increase to as much as 7.7 percent.

With the change in its voting right structure, the IMF hopes Asian countries will make more contributions to the global economy as a whole, including beefing up regional cooperation and coordination.

2ND ENGINE OF GROWTH

Meanwhile, Asia still faces various challenges on its way forward, said Strauss-Kahn, pointing out that it needs to expand trade within the region as well as with other parts of the world.

Vulnerability in the financial sector and fiscal status are also counted as challenges Asia is confronting while it tries to share leadership in the global economy, according to the IMF.

Amid risks and challenges, Asian countries are in need of developing the so-called "2nd engine of growth," the IMF said.

Among many that have been discussed during the conference, most frequently brought up was the issue of domestic consumption, which was diagnosed to be weaker than it should be.

Calling some of Asian economies too export-driven, Chin Dong- soo, head of South Korea's financial watchdog Financial Service Commission (FSC), said that they should pay more attention to boosting up domestic consumption.

The IMF head echoed the point, saying Asia needs to nurture domestic consumption, while adding that countries need to focus on how to solve social imbalances and the poverty issues.

Asian countries, on the other hand, were also urged to join the IMF-led global economic policies, said Strauss-Kahn.

IMF'S ROLE

With respect to what the IMF should do, Strauss-Kahn said that the fund will promote its efforts on improving the effectiveness of its policy advice so as to provide better service to a "broader " range of people in Asia.

"We will strive for an even-handed approach to surveillance, which will enhance the effectiveness of the IMF's policy advice. We will serve a broader Asian audience through increased outreach activities," he said at the closing conference.

He also mentioned the Group of 20 meetings, for which the IMF is in charge of developing and analyzing policies at practical level, in that the fund will work "closely" with Asian countries to strengthen the global financial safety net.

The IMF head also vowed that the IMF will continue its part in the poverty issue, continuously providing help to low-income countries in Asia.

Source: Xinhua
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