The International Monetary Fund has failed to provide the blueprint for pushing global finance and governance toward healthy conditions.
There appears to be a deepening disagreement among finance ministers attending the IMF spring meeting on Sunday over how and when to abandon recession-busting policies by the world financial body.
The IMF's managing director, Dominique Strauss-Kahn
Ministers were also unable to finalize a USD 500b boost to the IMF's resources put forward earlier this month by the Group of 20 (G20) Summit in London. Dominique Strauss-Kahn, the IMF's managing director, said there were already differences among members over 'an exit strategy'. Strauss-Kahn said there was consensus about the need to borrow more during the crisis: "Some of us, including the IMF, are arguing that the stimulus is necessary, but at the same time, you need to have a view about what is going to happen in three years' or four years' time, and prepare the exit strategy from the stimulus.
" Some blame the disagreement among finance ministers on the restructuring plan the United States has proposed for the IMF. The Europeans are especially resistant to such radical changes. Rejecting the call by the US treasury secretary Timothy Geithner to cut the number of IMF seats from 24 to 20, by 2012, Belgian finance minister Didier Reynders endorsed the current number of seats. "I think that for the moment the representation around the table is attractive.
The European countries are having to finance the Fund very strongly so we have to take into account the size of each country's participation in the Fund," Reynders noted. The IMF warned this week that the world economy would contract this year for the first time since the World War II.