Finance Ministers from the G20 Group of leading economies have met in Washington to discuss boosting the IMF’s resources, after it was revealed that IMF managing director, Christine Lagarde, wants to boost the organisations lending capacity by £250 billion.
The call by Lagarde to increase the IMF pot is understood to have put increasing pressure on the Chancellor to contribute more, with Lagarde herself saying: “The UK is a founding father of the IMF. And the UK is there for international grave situations. It's always been a very loyal partner when it's tough.
“But it's in their interest. Because if the key partners of a country like the UK are in very bad shape, they are bad clients. It's not in the interest of the UK to have a weak Euro.”
Previously, the Chancellor admitted that “there is a case" for increasing the IMF pot, saying he would have to "think very hard" about rejecting any request; although he did warn the IMF that the UK stands ready to boost its contribution, but only if certain conditions are met.
It is understood, should the Chancellor feel it is appropriate, he is able to commit an extra £10 billion without approval from Parliament, although Treasury sources have stressed that any deal has to be done at a “global level” and it must meet strict conditions.
For more information, please contact Glazers, Chartered Accountants London or visit www.glazers.co.uk
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