IMF Issues Global Policy Agenda for April 2014 Meeting

This is a report issued by the IMF Managing Director that sort of summarizes the overall work and plans for the IMF.  Here is introductory paragraph for the report:

"The Global Policy Agenda (GPA), presented semi-annually to the International Monetary Fund and the Financial Committee (IMFC), identifies the policy challenges faced by the membership and outlines policy responses that are needed at the global and country level to address these challenges."

There really is not much new in this report but on page 13 they do address the ongoing disappointment over the IMF reforms not being approved. Here are those comments:

"The delay in making effective the 2010 reform package is utterly disappointing. The IMF remains fully committed to support the implementation of the 2010 reforms and to finalize the 15th General Review of Quotas. These reforms are essential to ensure the continued legitimacy, relevance, financial strength, and effectiveness of the Fund.   Next steps will build on the advice of the Chairman of the International Monetary and Financial Committee (IMFC) in his consultations with the membership regarding available options to complete the current round of the quota and governance reform process, with the objective of completing the 15th Review by January 2015. The 15th Review is expected to result in further increases in the quota shares of dynamic economies in line with their relative positions in the global economy, and hence likely in the share of emerging market and developing countries as a whole, while steps will be taken to protect the voice and representation of the poorest members."

So here we see that the IMF is pretty much giving up any hope for these reforms until at least January 2015. There is nothing right now that would suggest the US Congress is going to change on this since this is an election year and Republicans opposed to the IMF reforms are expecting to win this fall. If that does happen, it calls into question whether the reforms will be approved anytime before the 2016 elections.

We have the BRIC's led by Russia and China openly upset that these reforms are not being approved in the US. They say they will look for options to bypass the US and get the IMF reforms approved anyway. But they have yet to put forward any public plan on how that would be accomplished.

It appears to be an ongoing stalemate unlikely to change unless:

1) The BRIC's try to force some kind of overhaul to the IMF over US objections

2) Some kind of new global financial crisis emerges that prompts major change to take place quickly (derivatives blowup, too big to fail bank goes under, major war, etc)

3) The BRIC's essentially just forget the IMF and move forward with their own regional institutions to replace the traditional role of the IMF in their areas of the world. They continue to work on bypassing the US dollar and expansion of the yaun and ruble in trade deals and especially energy deals impacting the petrodollar.

Right now, #3 seems the most likely unless #2 comes into play.

We will watch the G20 and BRIC comments following the meetings this weekend to se if they talk publicly about what will be done about this situation, if anything.