Korea’s Influence in IMF to Rise

With the agreement by the Group of 20 economies to improve the governance of global financial organizations including the International Monetary Fund, the influence of emerging economies such as Korea on the fund is expected to rise.

G20 leaders concurred in Washington Saturday that global financial institutions, such as the International Monetary Fund and the World Bank, need reform to better reflect changes in emerging and developing economies, and that the Financial Stability Funds must expand urgently to a broader membership of emerging economies.

The expansion of the fund’s shares will give a country greater voice and have the fund draw out larger bailout amounts, effectively raising the amount of foreign reserves.

Korea`s IMF quota was 1.413 percent, ranking 15th among the G20 countries excluding the European Union. Given that Korea’s GDP ranked 12th in the group last year, its share in the fund fails to match its economic prowess.

The same goes for China, the G20’s third-largest economy but ranked sixth in the IMF quota; ninth-ranked Brazil (14th); and 15th-ranked Turkey (19th). Leading advanced economies such as the United States and the EU oppose the expansion of emerging economies’ shares to prevent losing ground in the fund.

havefun@donga.com