WASHINGTON (Sputnik) — The IMF chief has called for a "global policy upgrade" to change the situation, in particular regarding the rules that govern exchange rates, reserves and regulations in place that allow countries to access liquidity during crisis.
"From the point of view of emerging markets, the current international monetary system is less supportive than it should be," Lagarde said in a speech at the University of Maryland.
"In addition to safer capital flows, a stronger international monetary system must include an adequate global financial safety net — to enable access to financial resources in times of crisis or distress," Lagarde said.
"This means that millions of poor people are finding it more difficult to get ahead," Lagarde underscored.
She also added that weaker corporate earnings and revenue in emerging markets can trigger financial spillovers to the rest of the world.
The IMF has already taken a step toward a system that would be more supportive of the emerging economies. In January, the fund fully implemented a historic 2010 quota and governance reform, which shifts voting power to emerging market nations. For the first time, the ten largest members of the IMF include Brazil, China, India, and Russia.
