The International Monetary Fund (IMF) Executive Board has given its approval to a proposal set to be presented to the Board of Governors, aiming to conclude the 16th General Review of Quotas with a substantial increase. This move aligns with guidance received from the International Monetary and Financial Committee (IMFC) during the 2023 Annual Meetings.
IMF Managing Director Kristalina Georgieva emphasized the importance of this proposal, stating, “Concluding the 16th Review with a quota increase will help preserve a strong, quota-based and adequately resourced IMF at the center of the Global Financial Safety Net. An adequately resourced IMF is essential to safeguard global financial stability and respond to members’ potential needs in an uncertain and shock-prone world.”
The proposed increase involves a 50 percent boost in quotas, distributed among members based on their existing quotas. This initiative aims to fortify the IMF’s permanent resources and reinforce the quota-based structure of the Fund by minimizing reliance on borrowing, thereby upholding the primary role of quotas in Fund resources.
Furthermore, the proposal envisions a reduction in borrowed resources, including Bilateral Borrowing Agreements and New Arrangements to Borrow (NAB), once quota increases take effect. This adjustment is intended to maintain the Fund’s current lending capacity.
Acknowledging the urgency of quota share realignment to better reflect members’ relative positions in the global economy, the proposal calls for the Executive Board to develop possible approaches for quota realignment by June 2025, as a guide for the 17th General Review of Quotas. Implementation of this guidance is slated to commence promptly following the conclusion of the 16th Review.
IMF Managing Director Kristalina Georgieva expressed optimism regarding the proposal, given the complexities of the current global economic landscape. She urged international cooperation, stating, “In the spirit of international cooperation, I am hopeful this proposal will garner the broadest possible support from the membership, and that we will then make progress on a quota realignment under the 17th Review.”
Highlighting the significance of unity in challenging times, Georgieva remarked, “As the world grapples with rising fragmentation, today’s decision is a strong signal that the membership can still come together in support of cooperative solutions that instill confidence in the IMF’s ability to effectively support its membership to navigate a challenging global landscape.”
The Executive Board has called for a vote on the proposal by December 15, 2023, with approval requiring an 85 percent majority of the total voting power from the Board of Governors.
