BRIC nations not to boost IMF resources without representation

Brazil, Russia, China and India have opposed plans to boost the resources of the International Monetary Fund and expand credit without putting in place a better regulatory mechanism and increased say for the emerging economic powers and other developing countries.

Guido MantegaBrazil, Russia, China and India (BRIC) will not contribute any extra money to the IMF until their voting power at the agency are raised, Brazil's finance minister Guido Mantega said in reply to World Bank group president Robert B Zoellick plea to increase member contributions to the IMF.

''The danger now is doing too little too late, incrementalism will prolong and increase risk. So far, the stimulus packages are short of the IMF target of 2 per cent of GDP, the assessments so far show about 1.4 per cent, and increasingly important, the possibility of withdrawal of stimulus in 2010, said Zoellick after talks with host UK's prime minister Gordon Brown and finance minister Alistair Darling.

''Stimulus packages alone are not enough. The IMF research of some 122 financial and economic crises shows that turnaround can't happen unless you clean up the bad assets and recapitalise the banks, and if you don't take on the banking issue, the stimulus is just like a sugar high.  It pushes some energy through the system, but then you get the letdown unless you reopen the credit markets,'' he said.

Without extra spending, he said, poor countries will suffer more, millions will fall into poverty, and growth will slow down.  About 200- to 400,000 more babies will die each year, he added.

''I believe it will be a positive sign if the G20 supports expanding IMF resources, condemns protectionism, and endorses a series of targeted practical solutions, including for developing countries,'' he said.