Emerging nations push for say in global market

09:55, April 23, 2010      

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Developing countries will this week demand a louder voice at the World Bank and the IMF, as they are contributing more funds and because, Greece, now a eurozone country, is in need of a rescue plan.

The US and Europe, which have long dominated the Washington-based international institutions, acknowledge the growing clout of the emerging market economies such as China and Brazil but are loath to part with their power.

Brazil, Russia, India and China, the so-called BRIC club, called last week for swift reforms in the global institutions when their leaders gathered in Brasilia ahead of key financial meetings in Washington.

"Increased income and growth in the developing world means increasing influence," World Bank President Robert Zoellick said last week. "Today's discussion requires a big table to accommodate the key participants, and developing countries must have seats at it."

Brazil and other developing countries have been calling for a 6 percent shift in voting power at the World Bank. That would bring the representation between developing and developed countries to parity.

"We can no longer accept a situation in which the majority of the world's people remain inadequately represented in such bodies," South African President Jacob Zuma said during a recent visit to Brazil.

A Brazilian government source conceded that Brazil was pessimistic about achieving an equal say for developed and developing economies at the World Bank.

Brazil will keep pushing for parity in the long term, but a smaller shift of between 3 and 4 percent would be acceptable for now, said Rogerio Studart, who represents Brazil and other developing countries on the World Bank's board.

The shift would not achieve parity but would help rebalance a breakdown that now stands at roughly 40 percent for developing countries and 60 percent for developed nations.

"A profound change in the structure of the IMF is needed so that all countries can trust in it and know that it is objective," said Nestor Stancanelli, deputy secretary for international economic negotiations for Argentina.

Source: Global Times


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