Mumbai: Members of the International Monetary Fund (IMF) are likely to approve a proposal to raise quotas for China, South Korea, Mexico and Turkey, despite opposition from major developing countries like India, Brazil, Argentina and Egypt.
If the proposal goes through, China, Mexico, South Korea and Turkey would receive increased quotas in the IMF in the first phase of the proposal.
The proposal needs 85 per cent of IMF members' votes to pass and that has 'already been obtained,' Argentina's economy minister Felisa Miceli said, adding "We are more or less convinced this will go through."
"The present quota calculation formula is opaque and flawed," finance ministers from Brazil, India, Argentina and Egypt said in a statement, adding other countries also opposed the proposal. They said the plan's call for a second stage - which would address quotas for countries not dealt with in the first stage - was by no means guaranteed.
The G-24 group generally welcomed the IMF proposal despite a split view among its members. The voting will end on Monday afternoon and the results will be announced later.
The IMF, set up to foster financial stability and aid countries in distress, was initially focused on the needs of the developed countries but, over time, the importance of emerging economies has grown. The current proposal is meant to boost the voice of emerging economies to reflect their greater share of the world economy.
The quota of each country is determined by its financial commitment to the IMF. The US currently counts for about 17 per cent of the total voting rights while Japan counts for 6.1 per cent. Argentina has a 0.99 per cent share of the vote, while the African nation of Swaziland has 0.03 per cent. This does not reflect the current realities, say supporters of the new quota plan.
Later, the IMF plans to rework the voting shares of the all 184 member countries, based on a new quota formula.