(Reuters) - IMF chief Christine Lagarde on Thursday urged member countries to quickly sign off on an agreement last year to double IMF resources and give under-represented nations, such as China, greater voting power in the global lender.
The changes to members’ quotas, which determine how much each country contributes to the IMF and their voting shares, are critical as a euro zone debt crisis escalates and is set to slow global growth in 2012.
Lagarde said the IMF’s 187 countries had until October 2012 to get the necessary votes to implement the 2010 decision to double quotas, which would make China the Fund’s third-largest member country.
The deal was clinched in South Korea in October 2010, which agreed to shift more than 6 percent of voting shares to dynamic countries such as China and double the IMF’s quotas, which would make available about $755 billion to the fund.
The IMF said Lagarde “called on members to use their best efforts to make the 2010 reform package effective before the 2012 annual meetings.” The meetings take place in Tokyo in mid-October.
An IMF staff paper said “efforts to meet the 2012 deadline should not be spared.”
As of December 12, just 53 countries, holding 36 percent of total IMF quotas, had approved the increases. Approval by members holding about 70 percent of quotas is needed to implement the changes. Some countries require their legislatures to authorize the changes.
The measure still requires approval by the U.S. Congress, where Republicans are taking aim at any IMF move to bail out troubled euro zone countries, saying they don’t want American funds involved.
The lawmakers are trying to snatch back a $100 billion line of credit the U.S. approved for an IMF crisis fund in 2009 at the height of the global financial crisis.
Reporting By Lesley Wroughton; Editing by Gary Hill