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| China's Increased IMF Voting Power Reflects Growing International Influence |
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China's increased voting power in the International Monetary Fund (IMF) highlights its growing influence on the world stage, according to a Chinese economics expert. "The greater share of the vote not only means it can receive more loans from the organization, but also create a more favorable environment for developing countries, said Tan Yaling, of the China International Economic Relations Council. The IMF's Board of Governors approved a resolution on Monday to give more voting power to China, South Korea, Mexico and Turkey. China now has 3.72 percent of the voting share, up from 2.98 percent. Tan admitted that the seven major industrialized countries, including the United States and Japan, still dominate the IMF as well as the international finance market. "The increase from 2.98 percent to 3.7 percent has only a symbolic meaning for China to some extent," she said, "but it is China's right to have a greater say in the IMF as its economy has been booming for the past two decades." Before the reform, China had less voting clout than Belgium and the Netherlands combined. Its GDP, however, is twice the two countries' sum. The voting reform is just a small step towards a more reasonable international financial order, but it will only play a very limited role in solving the problem of global economic imbalance, said Fang Ming, senior analyst with the Bank of China. China should be very cautious about IMF reform and a more important task for China is to push for a change in the international financial order in a just and reasonable direction, said He Fan, an expert with the China Academy of Social Sciences. The United States wants to strengthen coordination with developing countries through IMF reform, He said. Increased voting power in the IMF means greater responsibilities, so China may face greater pressure from western countries to liberalize its own exchange rate regime, according to He. But developing countries are beginning to play a greater role. "These reforms are the first step in a process that will increase the representation of many emerging market countries to reflect their increased weight in the global economy," said IMF Managing Director Rodrigo de Rato. (Xinhua News Agency September 21, 2006) |
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