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Brown presses for IMF reform The IMF needs reform to help the world economy better withstand challenges, because the Group of Seven can no longer manage the global financial system on its own, Chancellor Gordon Brown said late on Friday. In Washington for the spring meetings of the International Monetary Fund and World Bank, Brown told reporters the Bretton Woods institutions urgently needed an overhaul Advertisement "This is not true today," he said. "In the past, exchange rate policies could be seen to be simply a matter of concern between the advanced industrial countries and involving other countries only as borrowers. This is not the case today." Brown said there had to be a place where the G7 could discuss with emerging market countries their accumulation of currency reserves, a place where a global strategy to cope with imbalances could be thrashed out. "In the face of high oil prices, rising protectionism and current account imbalances, we need our international institutions to adopt pro-stability and pro-growth strategies more detailed than in the past," he told reporters. "We are proposing the multilateral surveillance of the IMF be extended beyond what is the main focus, which is in-country programs and Article IV reports (periodic reviews), to multilateral surveillance to what are the barriers to growth in the world economy." Brown, chairman of the IMF's main policy steering group, said surveillance should be made more credible and effective by freeing the fund from political influence, and he set out a series of proposals to help that happen. He wants the IMF's board to set a new annual remit for surveillance, remove the link between economic monitoring and lending, and promote transparency. Brown also wants the IMF to take on new responsibilities for both bilateral and multilateral surveillance so the IMF managing director would be able to get countries together on an ad hoc basis. "I welcome Rodrigo de Rato's proposal for modernising -- for the first time in 30 years -- the fundamental basis for IMF surveillance as a way of doing this," he said. "And I welcome Rodrigo's proposal for a new facility for contingency financing for emerging economies." Brown said it was also vital that a modernised fund was seen as legitimate in the eyes of its shareholders and that meant enhancing the voice of the poorest countries and increasing the quota share of the most under-represented countries. "There is no doubt the system you create can make a difference," he said. ---------------------------------------------------
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