The world’s fast-growing Bric nations of Brazil, Russia, India and China are among 12 countries to stump up billions more for the IMF bailout pot to prop up their Western counterparts.
The IMF crisis-fighting fund now stands at $456 billion (£291 billion) after an extra $26 billion was pledged at the G20 summit in Los Cabos, Mexico, up from $430 billion in April.
The Brics have contributed a total of $73 billion in commitments to the IMF to help ward off a crisis largely made in Europe, as the single-currency bloc threatens to break apart with potentially devastating consequences for the global economy. IMF managing director Christine Lagarde (above) said: “These resources are being made available for crisis prevention and resolution and to meet the potential financing needs of all IMF members. They will be drawn only if they are needed as a second line of defence.”
Despite stumping up the extra funds the Brics have been frustrated by what they see as slow implementation of vote reforms to give them more say in the global lender. They are pushing the G20 to implement IMF voting reforms “in full” by October to reflect the growing economic prominence of emerging countries. A draft G20 communiqué said reforms “are crucial to enhancing the IMF’s legitimacy, relevance and effectiveness”.
