WAM MOSCOW, June 15th, 2013 – Russia will use its presidency of the G20 to push for a radical overhaul of the International Monetary Fund (IMF) and changes to its voting system to give developing economies a stronger voice, President Vladimir Putin said in an interview with Russia’s news agency RIA Novosti.
“The IMF frequently fails to keep up with the rapidly changing situation in global finance – first and foremost, in making effective and timely decisions,” Putin said in answers to written questions, adding that the decisions’ “implementation leaves much to be desired as well.” Russia currently holds the rotating presidency of the G20, a formal grouping of the world’s 20 most powerful economies, and will lead the G8, a group of the world’s eight richest countries, in 2014.
Putin did not call for the outright dissolution of the IMF, but argued that the organization must adjust to “current economic realities” and said it was time to consider the issue of its “overall reorganization.” In particular, he said that the voting system used at the IMF to determine policy should be changed to “enhance the role of developing countries,” with new weight given to the so-called BRICS group of Brazil, Russia, India, China and South Africa.
The IMF has played a key role in international finance since it was set up in 1945.
As well as providing funding in emergencies – like the recent European sovereign debt crisis – it also provides expertise. Advice from the IMF was widely sought by Russian officials when the country was making its transition to a market economy in the 1990s.
Putin acknowledged that reforming the IMF would not be easy, but said Russia would attempt to negotiate some compromises and “mutually acceptable solutions” ahead of September’s G20 Summit in St. Petersburg.