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Has the IMF turned irredeemably irrelevant? - Paranjoy Guha Thakurta
Has the International Monetary Fund (IMF) become completely irrelevant? Is this world body, set up more than six decades ago to foster global economic stability and help countries facing financial crises, really reforming itself? And will it become more responsive to the aspirations of developing countries? Opinion is sharply divided on these questions as the IMF undergoes an exercise to change its "quota and vote" system that is linked to the financial commitments made its 184 member countries. A member's quota delineates basic aspects of its financial and organisational relationship with the fund, including its powers to vote and its access to loans.
Three years ago, the IMF had loaned more than $100-billion to various countries to help them tide over problems including management of external balance of payments. This amount has now shrunk to less than $20-billion a year. In fact, instead of primarily being a lender of funds, the IMF has become a net receiver of funds with an inflow in excess of $20-billion in the form of repayments of past loans, much of it from developing countries.
"The IMF has today become completely irrelevant," observed Professor Jayati Ghosh, who teaches economics at New Delhi's prestigious Jawaharlal Nehru University, in an interview.
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