Emerging powers join forces for finance reform

By Todd Benson and Elzio Barreto

SAO PAULO (Reuters) - Emerging economies staked their claim to a bigger role in the world's financial system on Friday, saying the crisis that has hammered rich countries showed it was time for them to take a seat at the big table.

The "BRIC" nations of Brazil, Russia, India and China, meeting ahead of broader talks this weekend, for the first time forged a joint position that called for reform of institutions like the International Monetary Fund to reflect the growing importance of developing economies.

"Emerging countries are ready to shoulder the financial consequences of a bigger participation at the IMF," Brazilian Finance Minister Guido Mantega told a news conference in Sao Paulo. "There is no point in us increasing our participation if the big countries keep their veto powers."

With the United States and Europe reeling from the global financial crisis, faster-growing emerging economies are being asked to play a bigger role in helping the IMF protect small countries from fallout from the credit crunch.

In return, new heavyweights like the BRIC nations want more influence at the global financial institutions which have long been the preserve of the 20th Century powers.

"We called for the reform of multilateral institutions in order that they reflect the structural changes in the world economy and the increasingly central role that emerging markets now play," finance ministers from the BRIC countries said in a joint statement after their meeting on Friday.

The statement also said the Financial Stability Forum, which groups the G7 and some other major economies, should be immediately expanded to include big emerging countries.

The show of unity came as finance ministers and central bankers began arriving in Sao Paulo for an annual meeting of the G20 group of the world's biggest economies which will be dominated by discussions of how to respond to the crisis.