Reform of the World Bank, IMF would help ease poverty: Mbeki to G20

from Monsters and Critics

Johannesburg - South African President Thabo Mbeki on Sunday called for substantial reform of the International Monetary Fund and the World Bank as instrumental in stepping up the fight against poverty in low-income countries.

Mbeki was speaking at the weekend G-20 summit of finance ministers and central bank heads, which ended Sunday in Kleinmond, near Cape Town.

The G20 comprises the Group of Seven wealthiest nations (Britain, Canada, France, Germany, Italy, Japan and the United States), the European Union and 12 other leading economies: India, Brazil, China, Russia, South Africa, Saudi Arabia, South Korea, Australia, Argentina, Turkey, Indonesia and Mexico.

'This (change of the IMF and World Bank) is necessary because the current governance framework inadequately serves the collective and individual interests of the membership of the two institutions,' he said.

Reforming the governance of the two bodies would 'help to accelerate the process of the eradication of global poverty,' he added.

The G20 was formed in Germany eight years ago to promote dialogue between finance ministers and central bank governors of leading economies at an annual meeting on policies that promote 'high and sustainable growth.'

Discussions at this year's summit, held under the theme 'Sharing - Influence, Responsibility, Knowledge,' focused on currency volatility, especially the weak US dollar, rising prices of commodities including oil and reform of the IMF and World Bank.

The IMF's new head France's Dominique Strauss-Kahn described as a movement 'in the current direction' the depreciation of the US dollar, although he acknowledged some currencies, like the euro and the Canadian dollar, were bearing the brunt of the adjustment.

The US dollar is trading at its lowest levels against the Canadian dollar in over a century at 97 cents to the dollar.