The International Monetary Fund (IMF) Executive Board has suggested a 50% quota increase for members, including Ghana, in proportion to their present quotas.
This is subject to approval by the Board of Governors.
The idea is in line with the recommendations made by the International Monetary and Financial Committee (IMFC) in the 2023 Annual Meetings.
According to the Fund, the quota increase would contribute to global financial stability by increasing the IMF’s permanent resources and decreasing its reliance on borrowed resources.
Once quota increases are implemented, the borrowed resources comprised of Bilateral Borrowing Agreements and New Arrangements to Borrow (NAB) will be lowered to preserve the Fund’s present lending capability.
“Concluding the 16th Review with a quota increase will help preserve a strong, quota-based, and adequately resourced IMF at the centre 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,” IMF Managing Director Kristalina Georgieva said after the Executive Board’s decision.
The membership has also recognised the urgency and importance of realigning quota shares to better reflect members’ relative positions in the global economy while protecting the quota shares of the poorest members, and many members would have supported a quota realignment now, in addition to the proposed quota increase. As a result, another essential component of today’s proposal is a request to the Executive Board to work on developing viable ways as a roadmap for further quota realignment, including through a new quota formula, by June 2025, as part of the 17th General Review of Quotas.
“The proposed quota increase comes at a complex time for the global economy and the IMF’s membership. 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,” said IMF Managing Director Kristalina Georgieva.
The plan also includes a request for studies to establish viable ways as a framework for future quota realignment by June 2025.
“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 instil confidence in the IMF’s ability to effectively support its membership in navigating a challenging global landscape,” she said.
The Executive Board has proposed that the Board of Governors decide on this proposal by December 15, 2023.
A majority of 85% of the total voting power is required for approval by the Board of Governors.