WASHINGTON Jan 22 U.S. President Barack Obama
wants to reform the International Monetary Fund to give
developing nations a greater say in the institution, U.S.
Treasury Secretary nominee, Timothy Geithner, said on
"We need to send a strong signal that we are ready to give
developing countries a voice within the IMF that is
commensurate with their importance to the world economy,"
Geithner said in written answers following a congressional
hearing on his nomination on Wednesday.
His nomination won Senate Finance Committee backing on
Thursday despite concerns expressed by some lawmakers that he
underpaid $34,000 in taxes while he was employed by the IMF.
Geithner, who worked in the IMF's policy and review
department from 2001 to 2003, said the Obama administration
would work with Congress to bring about reform at the IMF,
where the United States is the biggest shareholder.
The Bush administration supported a decision by the IMF in
March last year to redistribute voting power, or quotas, among
its 185 members and boost the influence of emerging economic
powers such as China, India, Brazil, Mexico and South Korea.
The United States and European countries have clung to
their long-standing dominance of the global lender with the
United States refusing to give up its veto power.
The decision on quota reform and a separate proposal to
sell a limited portion of the IMF's gold stocks is currently
awaiting approval by U.S. Congress.
Geithner said it would be better if both decisions were
dealt with at the same time.
"Rather than dealing with IMF reform on a piecemeal basis,
it probably makes sense to handle the gold sale issue and quote
reform at the same time," he said.
Geithner said the gold sales would put the IMF on sounder
financial footing, following years of declining income as fewer
countries needed its loans.
But the global economic crisis has prompted countries to
turn to the IMF for financial help once again, including
recently Hungary, Latvia, Ukraine, Serbia, Belarus and
"It makes sense to ensure that the IMF can carry out these
central functions without having to rely on income from crisis
lending," Geithner said.
"The IMF may well need more resources to shepherd emerging
economies through this crisis, but the sale of IMF gold is not
intended for that purpose (nor would it raise enough money),"
(Reporting by Lesley Wroughton; Editing by Andre Grenon)