Finance officials support IMF to strengthen surveillance
Published April 15th, 2007
Global finance officials voiced their support on Saturday for the International Monetary Fund (IMF)’s efforts to strengthen surveillance over global financial stability.
“The Committee welcomes the steps being taken to strengthen and modernize IMF surveillance to ensure its effectiveness as globalization deepens,” said a communique released by the International Monetary and Financial Committee (IMFC), the policy steering committee of the IMF.
The IMF should improve the quality of surveillance, its focus, candor, and evenhandedness, said the communique, noting it is important to “enhance the focus of surveillance on key risks facing members and on cross-country spillovers.”
Gordon Brown, Britain’s finance minister and head of the IMFC, said both the quality and the candor of the surveillance process need to be improved to preserve global economic stability.
The revision should be carried out in a way that adds no new obligations to IMF member countries and takes an evenhanded approach based on dialogue and persuasion, said Brown at the spring meetings of the IMF and the World Bank.
Meanwhile, U.S. Treasury Secretary Henry Paulson also urged the IMF to make fundamentally reform to strengthen surveillance over exchange rates.
“Exercising firm surveillance over members’ exchange rate policies is the core function of the institution,” said Paulson, a move speculated by some U.S. media to press China to speed up financial reform.
“Reform of the IMF’s foreign exchange surveillance is the lynchpin on which other reforms depend, and we look forward to action in this important area very soon after these meetings,” said Paulson. “The IMF staff must do a better job in addressing foreign exchange surveillance on a day-to-day basis.”
Ministers from both the developed and the developing countries also voiced their support for the IMF’s reforms in currency surveillance.
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