HANGZHOU: Leaders of BRICS countries urged the International Monetary Fund (IMF) to reassign quota and voting rights to ensure that the Funds fairly reflects the status of emerging markets and developing countries.
The leaders representing Brazil, Russia, India, China and South Africa, made the call during an informal meeting ahead of the G20 Summit. The five countries are also members of the G20.
Indian Prime Minister Narendra Modi presided over the meeting. India holds the rotating chairmanship of the BRICS organisation.
The leaders stressed that the current quota of the IMF failed to reflect the global economic situation, according to a statement issued after the meeting.
The leaders expect members of the G20 and the IMF to work together to increase quota sources of the IMF, and re-evaluate quota and voting rights to ensure that they fairly reflect the status of emerging markets and developing countries.
They called for the IMF to finish its 15th general review of quotas before the annual conference in 2017 and present a new formula for quotas. The quota formula is a weighted average of GDP and other factors, such as openness and reserves.
The IMF decided in 2010 to divert 6 percentage points of quotas to emerging markets and developing nations. After the reassignment, the top 10 IMF members, by quota, are the US, Japan, China, Germany, France, Britain, Italy, India, Russia and Brazil. The plan took effect in January.
However, Ruan Zongze, executive vice-president of the China Institute of International Studies, said the adjustment is not enough. For example, Japan holds the second biggest quota, Ruan said. But last year, Chinas GDP doubled that of Japan.
President Xi Jinping said BRICS members should enhance coordination to have emerging-market economies and developing countries play a bigger role in international affairs. Agencies