IMF and World Bank meetings

Springing into action
Apr 25th 2009
From Economist.com

Finance ministers gather for unusually significant spring meetings of the World Bank and IMF


LESS than a month after leaders of the biggest economies met in London, the action shifts this weekend to Washington, DC, where many finance ministers and central bank governors attend joint meetings of the World Bank and the IMF. These gatherings occur twice a year (in the spring and autumn) but this one probably matters more than most.
경제장관들이 자주 만나고 있다.

The global economic crisis has helped to give more relevance to the institutions—in particular the IMF—after many years of decline. The G20 meeting boosted the IMF, promising it an extra $500 billion in cash and the permission to print $250 billion-worth of its quasi-currency, the SDR. Another $100 billion of lending to developing and emerging countries (battered by the speedy exit of foreign capital after years of capital inflows) is supposed to come from the multilateral banks, led by the World Bank.
경제장관들이 만난 후로 IMF에서는 현금을 확보할 수 있었다. IMF를 지원하기 위해 3개국 이상이 힘을 합쳤다.
SDR:특별인출권

But it is still not entirely clear where all this money will come from, nor how it will be deployed quickly. Finance ministers may try to provide some answers this weekend.
그러나 돈을 어디서 확충할 지, 어떻게 쓸지는 정해지지 않았다.

Where, for example, will the full $500 billion in extra money for the IMF be found? Before the G20 meeting Japan and the European Union had each promised $100 billion and the summit ended with a promise from China of another $40 billion. In the weeks since Canada and Switzerland have each pledged $10 billion and Norway has pitched in with about $4.5 billion. The Indian press reports that the country might contribute $11 billion to the fund, and Brazil has offered $4.5 billion. All together that still leaves the IMF about $220 billion short of the G20’s target.
세계 각국이 돈을 내놓겠다고 했으나 여전이 2,200억 달러가 부족하다.

America may have to provide a big chunk of the remainder. Barack Obama has proposed a loan of $100 billion to the fund in a letter to Congress, which must approve an American contribution. France is likely to press EU countries to raise their contribution by $60 billion. The fund will also pass the hat to other possible contributors (perhaps including Saudi Arabia) with formal announcements of contributions possible over the weekend, along with confirmations of tentative offers (such as those from India or Brazil).
세계 각국이 돈을 내놓으라는 압박에 시달리고 있다.

Next is the question of what donors might expect in return. Brazil has already said that it wants reforms to how the IMF is run. All the big emerging economies want to see more detailed proposals on changes to voting power within the IMF, and they want the reform process speeded up. (The G20 encouraged the fund to implement the last round of changes, which were agreed in October last year, but did not set a date, which emerging economies will be keen to see announced). A recent suggestion from an IMF reform committee was for a larger role for finance ministers in the daily running of the fund, to give it greater political legitimacy. The idea may be discussed this weekend.

The IMF will also be keen to announce more emerging-economy interest in its Flexible Credit Line, which has now found three takers: Mexico, Poland and Colombia. Another country or two signing up will boost the fund’s claim that it is emerging as a credible source of insurance against crises, which is the purpose of its new “no-strings-attached” facility.

For the World Bank, too, much is at stake. It has not been showered with extra funds, but officials say that it has raised lending in response to the crisis, yet is in no danger of running out of money. But some in the institution argue that it should have pushed more aggressively for extra money to fund projects. Some poor countries’ finance ministers are expected to raise this issue at the meetings, and call for more capital for the bank. They may point to the IMF's announcement on Thursday April 23rd that it is doubling the upper limits on amounts that very poor countries can borrow on concessional terms, something that it is only possible because of all the extra money it has received.

Pressure may also increase on the bank to push for an early replenishment of the pot of money for the International Development Association, which is then used to fund zero-interest loans and grants to the world’s poorest countries. The current pot of $41 billion is supposed to last until 2011, but some argue that an early replenishment will enable more lending to the poorest countries, which the bank has argued are being hit badly by the decline in trade and slowing remittances.