IMF Head Upbeat After Spring Meetings

Posted April 21st, 2012 at 7:05 pm (UTC-5)
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The semi-annual International Monetary Fund-World Bank meetings in Washington came to a close Saturday after top economies pledged more money to the IMF to help combat future economic troubles around the world, especially in Europe.

IMF managing director Christine Lagarde said the big development of the meetings was the combined $430 billion pledge in additional resources from several countries, including China, Russia, Australia, South Korea, Singapore, and Great Britain.

The 17-nation European bloc that uses the euro has pledged $200 billion of the new IMF funds, with Japan saying it will contribute $60 billion. Switzerland, Norway, Sweden, Poland and Denmark have also said they would loan the International Monetary Fund more money to support its global lending efforts.

The amount nearly doubles IMF's reserves available for emergency loans to almost $1 trillion.

But so far, there have been no pledges from the IMF's largest shareholder, the United States. Washington has already set aside $171 billion in available loans to the fund, but has yet to ratify a 2010 commitment to increase funding by $60 billion, and an agreement is not likely in a U.S. election year.

At the top of the discussions was the continuing fear that a renewed European debt crisis could imperil world economic growth, especially if more countries need international bailouts like the ones already handed to Greece, Ireland and Portugal.

Another major European economy, Spain, is currently facing recession, soaring debt and steadily falling property prices.

Lagarde urged deficit-saddled governments to speed reforms and said the IMF must continually improve its economic surveillance mechanisms to act before it is too late.