IMF Agrees To Increase Executive Voting Seat To African Nations

The International Monetary Fund (IMF) reported on Saturday, October 14, that at its first meeting in Africa since 1973, member countries had decided to increase their contributions to the global lender and give sub-Saharan Africa a third seat on its executive board.

This week, the IMF and World Bank held talks in Marrakech, Morocco, where both lenders stated that increasing the IMF’s quota resources and giving Africa a stronger voice within the organization were among their top priorities.

At a press conference on Saturday, Spanish Economy Minister Nadia Calvino, who served as chair of the IMF Financial Committee, stated that there was “agreement on a meaningful increase of quotas by the end of the year.”

The quotas, which are based on economic size, determine how much money a country should contribute to the IMF, its voting power, and the maximum amount of loans it is eligible to receive.

During this week’s meetings, IMF Director Kristalina Georgieva and World Bank President Ajay Banga urged participants to increase funding so that their organizations could better assist countries affected by poverty and climate change.

The quota agreement, according to Georgieva, was “very heartwarming.”

The goal, she said, was “to make the fund strong financially in terms of our ability to step up should we be hit by yet another shock.”

Asked when the IMF will change its voting shares, Georgieva said: the “membership has agreed that this is going to be the next step and that there will be a clear pathway and plan to go there.”

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Giving countries with economies like China, which is currently the second largest in the world, a larger voting share has generated debate.

Japan, the third largest economy in the world, has 6.14 per cent of the vote to China’s 6.08 per cent.

“At some point, a revision of the IMF’s quota distribution will be inevitable,” French central bank governor Francois Villeroy de Galhau said in Marrakesh on Wednesday.

“But the emerging countries that will benefit from this — including China — will have to accept common rules of the game,” he said.

The IMF agreed to increase its executive board from 24 to 25 members in order to add a seat for Africa, but voting shares were left unchanged.

There will now be three executive board members from Sub-Saharan Africa rather than just two.

“I will finish with what warmed my heart the most: uniform support for a third African chair on our executive board,” Georgieva said.

“That is so important for meetings that take place on African soil,” she said.

“Despite all the difficulties I can only praise our members for finding this pathway to solidarity on which hundreds of millions of people depend.”