US Treasury Urges Congress to Pass IMF Quota Reform

US Treasury Secretary Jack Lew warned that until the quota reform is in place, the United States runs the risk of seeing its role in the IMF eroded, especially since other countries are establishing new financial institutions, such as the China-backed AIIB.

WASHINGTON (Sputnik) — US Congress should pass the International Monetary Fund (IMF) quota reform, which gives more voting power to emerging market nations, in order to protect American leadership in global financial institutions, US Treasury Secretary Jack Lew said on Tuesday.

“It is essential that Congress pass the IMF quota reforms,” Lew stated while presenting the annual report on the status of the international financial system.

“These reforms will… preserve America’s strong influence within the IMF, and more broadly as a leader of the international financial institutions,” Lew added.

In 2010, the G-20 group of countries — including the United States, Russia, France and Japan — agreed to shift voting power to dynamic emerging market nations such as China, India, Brazil and Turkey.

At present, the largest members of the IMF are the United States, Japan and Germany.

Lew warned that until the quota reform is in place, the United States runs the risk of seeing its preeminent role in the IMF eroded, especially since other countries are establishing new financial institutions, such as the China-backed Asian Infrastructure Investment Bank.

“We right now are the only country standing on the way of having the IMF reform become the policy of the IMF,” Lew stressed.

In February, the G-20 finance ministers and central bank governors said they are disappointed with the delays in the quota reform of the IMF.

A member's quota determines the maximum amount of financial resources the country is obliged to provide, its voting power and access to financing, according to the IMF.