Friday, April 11, 2014

Washington Times on IMF "Plan B"

The Washington Times runs this article which talks a little more about a mysterious "Plan B" mentioned by Christine Lagarde regarding the IMF reforms.

"The International Monetary Fund has a “Plan B” for proceeding with reforms giving greater powers to developing countries even though the U.S. has not approved them, but it is not ready to take that route yet, IMF Managing Director Christine Lagarde said Thursday."

"“I don’t think that our institution should move to Plan B until we have full certainty and massive disappointment that Plan A is definitely dead. I’m not prepared to declare that at this point,” she said at a press briefing, noting that the Obama administration has pledged to keep trying to get the reforms through Congress."

"Ms. Lagarde did not explain what “Plan B” might involve, but IMF officials say it would be difficult and complicated for the institution to circumvent the effective veto power that the U.S. has over major IMF decisions and activities. The U.S. has the largest voting share on the IMF board, with a 17 percent voting share that makes its approval indispensable most of the time."

"The emerging countries may press for faster action on the reforms than Ms. Lagarde is offering. In a sign that they already are the topic of backroom discussions, U.S. Treasury Secretary Jacob Lew met behind closed doors Thursday with his Russian counterpart, Russian Finance Minister Anton Siluanov."

 We'll continue to follow it to see if anything comes from the G20 and IMF meetings this weekend in Washington.

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