Nomination of China's Zhu as deputy chief has global significance (2)

14:25, July 14, 2011      

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Lagarde also spoke highly of her Chinese colleague.

"Zhu brings a wealth of experience in government, international policy making and financial markets, strong managerial and communication skills as well as an institutional understanding of the Fund, and I look forward to his counsel," she said in a statement.

"As deputy managing director, he will play an important role in working with me and the rest of my management team in meeting the challenges facing our global membership in the period ahead, and in strengthening the Fund's understanding of Asia and emerging markets more generally," Lagarde added.

Currently, the international economic landscape is reshaping, with increasing weight, contribution and policy making influence of emerging and developing economies in the world economy. It is widely proposed that the global economic governance should be strengthened.

Zhu said in an earlier interview with Xinhua that emerging economies became a main engine to drive the growth of the world economy last year, with a contribution of 70 percent to the growth of global Gross Domestic Product (GDP).

Under such circumstance, the nomination of Zhu as IMF deputy chief, putting aside his nationality, represented the change in the world economic landscape. It is also critical to the legitimacy and effectiveness of the IMF and one of the steps to improve the body's plurism.

However, the democratization of global economic governance is more than just selecting a deputy managing director. It has a long way to go.

Firstly, the traditional situation of the IMF led by Europe and the United States has not changed. Last year, the IMF's governing board agreed on increasing emerging markets and developing nations's share of quotas in the IMF. But the implementation of the reform plan still needs a process and even after the plan is implemented, the representativeness of some emerging economies still needs to be enhanced.

Besides, the IMF's role in monitoring the financial and economic situation in its member states and providing a juristic framework for policies and proposals needs to be improved.

The global financial crisis showed that the IMF's limiting its function to monitoring exchange rates was one of the reasons that led to its oversight of the crisis.

In the post-crisis era, promoting the governance and reform of international financial institutions including the IMF, improving institutional legitimacy and effectiveness and enhancing developing countries' say has great meaning for the stable, robust and sustainable growth of the world economy.

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