WASHINGTON (Reuters) - U.S. Treasury Secretary Steven Mnuchin said the United States opposes increasing overall funding and shareholding quotas for the International Monetary Fund, but supports extending a portion of the IMF’s $254 billion crisis fund.
In a statement for the IMF’s steering committee meeting, Mnuchin said it was important for the Fund to maintain sufficient financial resources to respond to potential crises.
“In our view, the IMF currently has ample resources to achieve its mission, and countries also have considerable complementary resources should a crisis emerge,” Mnuchin said in the statement, which was posted to the IMF website on Friday as global central bankers and finance leaders met in Washington for the IMF and World Bank spring meetings.
“Thus, we do not see a need for a quota increase at this time and support closure of the 15th General Quota Review as soon as possible.”
The IMF’s last quota increase was agreed in 2010, boosting the shareholding and influence of major emerging markets including China and Brazil.
The IMF has current total lending capacity of about $1 trillion, including the New Arrangements to Borrow crisis fund that was greatly expanded in 2009 at the depths of the last financial crisis.
That fund is set to expire in November 2022.
“We look forward to working closely with the IMF and other members to identify options for extending a portion of these borrowed resources so that the IMF can maintain adequate resources to deliver on its mission,” Mnuchin said, adding that the United States was seeking a “reasonable timeframe” for the next quota review.
Mnuchin also said the IMF should work to promote debt transparency and sustainability. Mnuchin and other U.S. Treasury officials, including David Malpass, who started this week as president of the World Bank, have been highly critical of China’s lending to emerging markets through its “Belt and Road” infrastructure program.
Mnuchin’s statement did not single out China, but he said: “Increasingly, opaque or unsustainable lending practices weaken investor confidence, erode governance and accountability and create a drag on economic growth.”
He said the IMF should promote greater transparency of borrowing from all creditors in its programs, laying a new benchmark for future programs.
Reporting by David Lawder; Editing by Paul Simao