Top Story of the Week: Losses, Victories for Developing Countries at IMF, World Bank Meetings

Finance ministers had a full agenda coming into the semi-annual meeting of the International Monetary Fund and the World Bank held in Washington D.C. last Oct. 8-10. But experts observed that very few issues were sorted out during the gathering.

Among the key points that remained unresolved at the conclusion of the meeting was IMF reform, particularly the matter of increasing the representation of emerging countries in the fund’s executive board.

The communique prepared by the International Monetary and Financial Committee noted that progress was made “toward finding common ground on the core reform areas” but also referred to a number of outstanding issues, including the size of the quota increase and the quota shift, enhanced representation of emerging markets and developing countries at IMF’s executive board, and modalities for protecting the voting share of the poorest members. IMF Managing Director Dominique Strauss-Kahn said he expects an agreement to be reached in the coming weeks.

At least one development expert criticized the IMF meeting for its “disappointing outcome.” Finance ministers focused too much on currencies and appeared to have forgotten developing countries, Mark Fried of Oxfam International said.

“Thousands of people have flown in from all over the world for these meetings, and there’s been no movement of any significance on any issues of significance,” Fried said.

Meanwhile, the World Bank meeting appeared to have a more favorable outcome for developing countries. World Bank President Robert Zoellick said the bank has moved to increase the voting power of developing and transition countries in the International Bank for Reconstruction and Development. Developing nations’ voting power at IBRD is now 47.2 percent, up by 4.6 percentage points.

Zoellick also underscored the bank’s decision to add a third seat for sub-Saharan Africa to its executive board. He further highlighted the representation of developing economies in the bank’s staff and management, noting that “all three of our managing directors and our chief economist are some leaders in finance and development from the developing world.”

The World Bank and IMF will be meeting again in April 2011, where they are expected to tackle presidential selection and dual performance.

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  • Ivy Mungcal

    As former senior staff writer, Ivy Mungcal contributed to several Devex publications. Her focus is on breaking news, and in particular on global aid reform and trends in the United States, Europe, the Caribbean, and the Americas. Before joining Devex in 2009, Ivy produced specialized content for U.S. and U.K.-based business websites.