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Financial G20 agree on need to increase IMF's capital — Russia's finance minister

September 05, 2016, 13:36 UTC+3 HANGZHOU

Finance Ministers of the G20 states have discussed the reform of IMF among other important issues

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HANGZHOU, September 5. /TASS/. Financial G20 agreed on the need to increase the equity capital of the International Monetary Fund (IMF), Russian Ministry of Finance Anton Siluanov told TASS on Monday.

Finance Ministers of the G20 countries traditionally met in the framework of the G20 summit in Hangzhou.

"The parties noted the strategic role of the IMF and the need to ensure sufficient resources for the fund to perform its tasks. The main focus should be on equity capital of the IMF, and not on borrowed. Therefore, it is important to regularly and in a timely manner revise quotas," Siluanov said. 

Financial G20 also supported the use of Special Drawing Right (SDR, the international means of payment issued by the IMF) in order to preserve the stability of the financial system, Siluanov added.

"The use of SDR was supported, as well as the instruments that use it, in order to maintain the stability of the financial system," he said.

Russia’s Sherpa in G20 Svetlana Lukash told reporters earlier that the distribution of quotas in the IMF still does not adequately correspond with the balance of powers in the global economy and will be discussed at the summit.

"The reform of the IMF is the most acute issue. At the beginning of 2016 the decision of 2010 on redistribution of quotas in favor of developing countries came into force, also the management system was slightly balanced taking into account real weight of emerging markets, but still the situation does not reflect the current reality, it does not adequately corresponds with the balance of powers, that would consider the weight of the BRICS countries and other developing countries," Lukash said.

"It undermines the legitimacy of the work of the IMF," she added.

Lukash also drew attention to the fact that the IMF is "running out of resources"

"Quota capital, which is the basis of the IMF’s work, is now shrinking and the effect of additional tools of the fund is coming to an end. All these issues are on the summit’s agenda. They were discussed during the year and they are the most relevant, of course," Russia’s Sherpa in G20 said.

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