January 18, 2012
At present, the IMF has around $385bn at its disposal to use in rescue packages (around half of its total resources). So even if it hopes to get the pot up to $1 trillion (not a whole extra trillion dollars), the IMF’s members would still be asked for a bare minimum of around $420bn(corrected to fix basic maths blunder)
And that will not be an easy sell.
Last October, US Treasury secretary Tim Geithner said he opposed expanding the IMF’s firepower, saying that the body already has “very substantial resources that are uncommitted”.
Under the IMF’s quota system, the US would be asked to provide 17.7% of new funding.
Although the fund is expected to target developing nations such as China and Brazil, Christine Lagarde would still face an almighty struggle to get a funding increase through without America on side.
This article was posted: Wednesday, January 18, 2012 at 6:20 am