Transcript of Press Conference by the IMF Managing Director Rodrigo de Rato

Press Briefing for Asia and Pacific Press
Washington, D.C.
August 31, 2006

MR. AHMED: Good evening, and welcome. I am Masood Ahmed, and I am Director of External Relations for the IMF. To my right is the Managing Director of the IMF, Rodrigo de Rato, and to his right David Burton, Director of the IMF's Asia and Pacific Department.

This is a live, on-the-record briefing by the managing director, who will open with introductory remarks.

MR. DE RATO: Thank you, Masood. Good evening, and I understand also good morning to those of you watching via the online Media Briefing Center. I realize this is very early for some of you. Thank you very much for being with us.

In two weeks we will be in Singapore at the Annual Meetings of the World Bank and the International Monetary Fund, and I want to thank you for being here and my opportunity to brief the Asian correspondents and the Asian media on those meetings.

Let me just give you the news today. An hour ago, the IMF Executive Board reached an agreement on our reform of governance and quotas. So, I think that's good news and to respond to what I believe is a very important cooperative spirit in the institution, for which I want to thank all the member countries.

The IMF is coming back in the Annual Meetings to Asia. We did the last one, if I remember correctly, in 1997 in Hong Kong. I was there as Finance Minister of Spain.

Right now Asia is certainly the most dynamic region in the world and a region that has grown in importance every year. We all know that Asia now accounts for nearly a quarter of the global GDP. Its share of world exports is over 27 percent and it has a third of global capital inflows. Asian growth prospects continue to remain bright with growth forecast at 7¼  percent in 2006 and 7 percent next year, which is a remarkable performance. It is clear that what happens in Asia is affecting not only the more than two and a half billion people that live in Asia but also the whole of the world economy. So, I think this is very timely that we have these meetings in Singapore to discuss not only the IMF but especially the needs of the member countries.

In the Singapore meetings there will be some specific issues on the agenda that respond to what is happening right now in the institution—certain issues of governance. And I think the vote tonight in Washington by the Executive Board is a very important step in the direction of making this institution respond more to the actual world economy of today and in the future and, at the same time, take into account the needs and the interests of low-income countries. But also in Singapore, we will have the opportunity to discuss the world economy and the surveillance role of the IMF in helping economies individually, and the role of the economy as a whole to continue in a growing path in the future.

So in that respect, let me just make a few remarks about the outlook for the global economy and for Asia in particular. We all know that the global economy has been resilient in the past year and, as I said before, for Asia and for the rest of the world also, and the growth prospects are very good. Just going over some of the most systemic economies: in the United States, we see the phase of expansion moderating, largely reflecting the change in monetary policy that has occurred in the last two years but also the slowing down in the housing market. The rest of the world—Europe and Japan, for instance-are on the other side making important comebacks—in the case of Europe, clearly above expectations. And Japan appears to have left behind more than ten years of deflation. All this is very good news for the world economy. It is that the United States evolves to a sustainable pace right now, which I think is also good news for the world economy. China and India continue to grow strongly, and many others countries, including sub-Saharan Africa are enjoying a continuation of the strong growth that we saw in 2005 and have bright prospects for 2007.

The world has been able to cope with very strong energy prices and also commodity prices, but we see some near-term risks that we should take into consideration. Certainly inflation risks because of capacity constraints but also because of commodity prices. Higher prices can certainly have an effect on inflation, and we encourage monetary authorities to be very vigilant. And certainly the setback in negotiations for trade liberalization is not good news, and we encourage the member countries of the IMF, and also member countries of the WTO to make important efforts to guarantee that multilateralism in trade continues to be the center of trade liberalization in the world. Global imbalances have continued to grow. It's true that they don't pose an immediate threat to the world economy, but if you compound global imbalances between savings and investment with the other risks or crises, inflationary pressures, protectionism—that is a combination that could be very risky for the world economy.

Let me now turn to Asia. For Asia, growth remains strong. Some modest rebalancing of growth is likely as exports moderate with slowing global growth because of certain markets in the United States, but at the same time we see signs of domestic demand strengthening. China is becoming an increasingly prominent driver of growth in Asia, and Japan's continued expansion has also contributed to buoyant activity. We see that inflation should remain subdued, and the region's current account surplus is expected to remain broadly unchanged, although the surplus that remains in Asia, if we exclude China, is declining. While that outlook is good as I just described it, there is in Asia also some near-term risks that I think policymakers have to take into consideration apart from the ones of the whole global economy that I just mentioned.

It is clear that Asia faces similar risks that I just mentioned for the world economy, and Asia is particularly sensitive to growth prospects in the United States and to oil prices. In addition, while the region has shown resilience to the financial market volatility in May and June, part of the volatility in global financial markets could affect capital flows, growth prospects, and inflation.

Let me now move to the issues in Singapore, which is in the general framework of implementing our Medium-Term Strategy. The Medium-Term Strategy is the response of the Fund to what we see is today the most important challenge affecting all our world constituency, which is globalization. Certainly globalization is creating important opportunities, but it also imposes challenges and is changing the nature of risk in, for instance, the financial markets. So in that respect, the Medium-Term Strategy tries to address and update the institution to cope with those issues in terms of surveillance, in terms of capacity building, in terms of low-income countries, in terms of our response to the importance of financial markets in the framework of macroeconomic policy in all countries, and also in terms of the governance of the institution in a global world.

As I said, addressing governance of the Fund, especially what is the political or legal voice of the countries is a key question in any institution and certainly in a global institution like the Fund. At present, I think that all members recognized that relative quotas and voting shares do not adequately respond to the reality of the world economy of the year 2000. Asia is a good example, but it's not the only example. I want to say that very clearly. Asia accounts for about a quarter of world GDP, and this is about one-third higher than its share of Fund quotas. And if you look at countries like China or Korea and others, you will find that that situation is very clear. You have also in Asia underrepresented countries as you have underrepresented countries in other areas of the world. But for an institution that wants to be legitimate in the world, having economic weight as the center of how countries express their views and have their voting power, we need to rebalance that situation regularly. This is not the first time it's been done in the history of the Fund. I want to say that outright. But it certainly was necessary to do it now, and I'm very happy that Singapore can be the center of this agreement that we've reached tonight here at the Board in Washington.

At the same time, in a complex institution like this one with representation of countries all over the world, and in the spirit of international cooperation that represents what the Fund stands for, the position of low-income countries is also a key question, and I am very glad that the Board has endorsed my proposal that rebalancing the weight of most dynamic economies is as important as recognizing the need to protect the low-income countries' voice—or the other way around if you prefer.

As I mentioned, today the Board has agreed on a program of two years to readdress quotas, the formula to calculate those quotas, phasing votes, a special consideration for African shares because of the amount of countries represented in those shares, and also to make the institution more flexible to adapt in the future to changes in the world economy and to make the institution also more responsive to the need of low-income countries in the future.

So, I believe that today we have given a good impetus to this reform package, and I can say that we will have a very important opportunity to present it to the world in Singapore.

Now let me turn to surveillance. Surveillance is at the center of our responsibilities as an institution—surveillance of individual countries and bilateral relations, and surveillance of the international economy through many instruments like the WEO and others.

In the spring we launched here a new instrument for global surveillance—multilateral consultations—and we are now in the process of implementing the first multilateral consultations, which focuses on global imbalances in which a group of countries, some of them from Asia, like Japan and China, are discussing with us and with others, like Saudi Arabia, the United States, and the euro area, how to face global imbalances, how to make them less dangerous for the world economy, how those very important economies can address that issue, and how coordinated action can make not only easier but more effective the management of global imbalances.

As I said, this multilateral consultation was launched a few months ago. We have already started working with these economies, and over the coming months we will continue the discussions. It is clear that global imbalances, imbalances between savings and investments, have been building over many years and could not and probably should not be changed over night. So, this is not a question of quick fixes, but this is a question of policy coordination at the highest level.

Certainly in the area of surveillance, not only global issues, like global imbalances, are at stake, but also the tool kit that the Fund has to help countries realize these opportunities and challenges and certainly to improve the quality of our analyses, including of exchange rates. And also, as you know, we are in the process of extending to countries of the major emerging economies, the analysis that the Fund currently does to assess whether exchange rates in industrial countries are broadly in line with fundamentals. This is certainly very sensitive information and at the same time it has methodological difficulties that have to be addressed, and that is part of the challenges facing our surveillance in the future as is also adopting our framework of surveillance at the bilateral level and Article IV to the new important role of the financial markets.

There are other issues that I just want to mention regarding our Medium-Term Strategy. Certainly one of the most important one is crisis prevention. We believe that although we are now in a very benign financial scenario of the world, we should prepare ourselves for coping with future shocks, especially given the size of the financial markets. This need for crisis prevention mechanisms that will help emerging economies with good fundamentals, but nevertheless with instabilities, cope with changes in the financial environment is now being discussed by the Board and I think will be a center of our work in future months.

Certainly our engagement with low-income countries, our work on capacity building, is also a very important part of our Medium-Term Strategy, as is also the need to have a more effective institution and a more transparent one and at the same time one that will be able to react more flexibly to the different needs of the different countries.

I just want to wrap up by thanking you all again for being here and by offering me and David Burton, and Masood to your questions. Thank you very much.

MR. AHMED: Thank you very much. Let me just say before taking questions —remind you of two things—one, that the opening remarks of the Managing Director will be made available to you in written form, and those of you who are on the Media Briefing Center, we will make them available to you through that. Secondly, just to remind you that in addition to the people that are sitting around the table, we do have some 45 people who are participating in this online and who are sending questions online, so I will also be taking questions from them as they come in, in addition to the ones coming from the floor. Please identify yourself and your affiliation when you ask the question.

QUESTION: Could you please flesh out a little bit more on India. You said China and India continue to grow strongly. In that context, what does the IMF see in terms of some of the problematic areas that a country like India will be facing down the road?

MR. DE RATO: Well, first of all, I want to say that India is one of the countries that has been changing in a very positive direction recently, that we see the government's reform agenda as a very important one as, for instance, the VAT reform of last year shows. But of course the question here is not so much what has been done in the past, although what is happening today has roots in the past, but how we can face the future.

India's growth has averaged an above-trend of 8 percent in the last three years. That is very important. But some inflationary pressures are building. So, in that respect monetary authorities and their efficiency is very important and it has been shown already, as it is the need to make the financial system more efficient and with bigger competition.

We also see the need for structural reform that will make India more capable of benefiting from the world economy. Certainly structural impediments, not only in terms of flexibility in the markets but also in terms of infrastructure, are a key question in the Indian agenda for the future.

MR. AHMED: Thank you. Let me now take a question coming in online. The question is: Any reform of the IMF to reflect the realities of the new world order is bound to be resisted by the U.S. and other OECD countries that at present have a huge say in the IMF. So, what makes you hopeful that it will happen?

MR. DE RATO: Well, I'm not just hopeful. I've seen it this afternoon. I mean, people have voted for some reforms that—of course, not all of them are going to be completed in Singapore, but are going to be launched in Singapore. And I reflect clearly that the countries see the need for a stronger and legitimate institution as important as their particular interests, and I think that is very encouraging. International cooperation is not an easy issue.

Every country has its own interests, and I think all the interests have to be taken into account and the question is to be able to see your interest in the broader picture of the whole institution, and I have seen that during all these months discussing quotas. Many countries have accepted to have a discussion that might not have immediate benefits from them and they have understood it would be beneficial for the institution. Other countries have accepted the need to reopen the question of the formula that calculates the quotas, and I think that is encouraging. But at the same time, of course, changes have to be meaningful and acceptable, and in a global institution balancing different interests is a key question.

QUESTION: You mentioned today's discussion on raising quotas in the Executive Board meeting. Would you briefly explain what did you decide in terms of raising quotas?

MR. DE RATO: Well, the decision is the one that I've described in terms of recognizing, first of all, the most underrepresented cases and trying to correct partially that situation that will affect three or four countries, then to launch a two-year program in which a new formula will have to be discussed, making it clear the new formula has to be simpler and more transparent. A very important question is how you measure economic quotas in the world. You have size, GDP, you have openness and you have other variables.

I think this is a demanding calendar—not only of two years but trying to have some meaningful issues, if not result at least outlined for next year, 2007, while at the same time trying to include in our system of future quota increases a realignment element that will allow the Fund to react and to respond to changes in the world economy in a more constant way.

And also part of the formula agenda is clearly to address the need for low-income countries to have a stronger voice. The voices of low-income countries have been eroded over the years, and this is a good time to reverse that trend and to give low-income countries not only a bigger share by increasing, raising votes but also ring-fencing the votes of low-income countries through basic votes.

This is a very plural package that has many aspects, as you can see, and I want to say that the fact that a very broad majority of the Board has been willing to accept this proposal, and this proposal will be sent to the governors in the next few days. Well, it is a good show of the view of the member countries that a global institution seems to be a cooperative institution.

QUESTION: Can I follow up? Four countries means China, Korea, Turkey, Mexico, is that correct?

MR. DE RATO: That's correct.

QUESTION: And the scale of their raising ad hoc quotas would be the 1.8 percent of the total quotas.

MR. DE RATO: It would try to correct about one-third of the actual misalignment. So, that means that we are moving but that there is still a lot of room to move.

QUESTION: On the multilateral consultation, I understand that you've already concluded some of your discussions in the five areas you mentioned. I was wondering what you think the added value would be for this consultation compared with the Article IV consultation, and also can you tell us when and how you plan to address the output of this?

MR. DE RATO: Well, bilateral consultations, multilateral consultations, are addressing a country's particular challenges and policy needs. Of course, there are some coincidental elements. But in multilateral consultations where you're trying, first of all, to have a common view on a global problem—this is a case of global imbalances. It's a common view and a common analysis, and that is very important. If you want to have a coordinated and collaborative approach on issues, first of all you have to have a shared view of the problem. If not, you will never arrive.

So we are building a very important element that maybe is not so easy to measure but is very important, and it will be very important if it's needed, which is to have countries work together to look at very complex and broad issues with the shared analysis. But this is not only a question of analysis, this is a question of policy. The question here is once we arrive at that common view of the issues and agree on what policies the different actors can take collectively—that is, combined with others doing other things—could we address global imbalances and could this affect expectations of markets but also change dynamics in macroeconomic policy.

Anybody who has had any experience in macroeconomic policy and policymaking knows that macroeconomic issues don't change overnight. And as I have the occasion of saying more than once, we don't want them to change overnight, because the only thing that changes overnight in macroeconomic realities are crisis. And that's exactly what we don't want to have. So, nobody should expect that savings rates, consumption patterns are going to change, well, in six months. But it's a very important question to address those points and changes. It is important for the countries themselves, but it is also important for the world economy.

QUESTION: Can I follow up, please? Especially on China, since the last spring meeting here in Washington, the Chinese have appreciated the yuan RMB a certain amount. Can you share with us what your view is on the Chinese exchange rate at this moment?

MR. DE RATO: Our last Article IV consultation on China last July, beginning of August, clearly showed that our view is that it is in the Chinese interest to let market forces determine economic allocation and prices in China more freely. That will make more efficient investment, better allocation of credit, and part of that liberalization and market forces playing a freer role in the Chinese economy certainly has to do with the value of the currency. It's clear that the Chinese authorities made a very important step last year by changing the routine, but now it's time for implementation.

We believe that the currency that will reflect better the reality of the Chinese economy is a key question for rebalancing the budget, the growth budget of China, to a more sustainable phase in which domestic consumption will be stronger than it is today, and investment will be more efficient. That is in the interest of China. But given the importance of the Chinese economy in the world that I just described in my initial remarks is important for the world. It is very important for the world that fiscal policy in the United States readdresses and reduces the double deficits—the dual deficits. That is very important in the United States, but it's certainly very for the world. And I think it's very important for the world that Japan has ended a deflationary period.

So, these are issues where nobody can expect that countries will do something that is not in their interest. But at the same time, given the responsibilities of those countries and the consequences of their economies, their interest is very important for other countries, too. So, this is what international cooperation is all about in macroeconomic issues.

MR. AHMED: I'm going to take another question now from the Media Briefing Center, and it's going back to quotas. The question is: When do you expect the second ad hoc increases in quotas of the September meeting in Singapore? How about a new formula for calculating quotas? When do you think that will take place? And what would be your recommendations for the new formula?

MR. DE RATO: Well, the Board has today endorsed the proposal that we should start discussing the new formula immediately. It's clear that there is a broad sense in the governments represented in the IMF, the 184 governments represented in the IMF, that the actual formula is anticipatory. So, in that respect, there is a sense of urgency and we need to discuss the formula. I mean, I have to say outright that that is not going to be easy, because it would have been easier to have it done before. So, I mean, we should expect that this is going to be a complicated discussion.

The Board has not clearly defined what are the parameters but has mentioned some of them that at least should be taken into consideration—openness, GDP, and others—so variability. I mean, this is going to be an important discussion, but it's going to start very soon. The Board understands that the two-year package is a sufficient timetable, that is to the Annual Meetings of 2008, but at the same time, the Annual Meetings of 2007 should be a very important step to take stock of what is happening and maybe having some agreements already. That is what I can tell you right now.

QUESTION: I have a general question about the Annual Meetings in Singapore. Do you have any specific proposals or ideas that will translate into easing the pains of countries like Bangladesh, for instance, that has been caused by the oil price hike? And what really do you tell the people who have been suffering, and how do you address that issues?

MR. DE RATO: Well, oil prices have increased very strongly in the last two and a half years, and my first message is that we should not expect a dramatic correction of the levels of prices we see today. There are many economic reasons to believe that oil prices are going to stay at a relatively high level. It is true that many people believe, and we could share that view, that it is a component of the actual prices that is related to geopolitical and political issues but, nevertheless, the reasons behind oil prices—strong demand—are very clear, and also some supply constraints both in refinery and also in production. So, my first message is that this is going to be a reality, and economies have to adapt to it.

My second message is that this demands from governments that they reassess their policies. Subsidies were never a very efficient social policy and they are becoming an unsustainable social policy. So, governments should start having better social policies, should start having direct help to the poor and, at the same time, give the right signal reducing subsidies to the economy. This has been done in some countries, like Indonesia for instance, in the area, but it should be part of the agenda. Nobody can expect that you can reduce subsidies immediately, but you should have an agenda and you should substitute that by efficient social policy that will help people cope with it.

Certainly efficiency in the use of energy is a key question, because, as I said in my first statement, energy prices are not going to be dramatically reduced. We're not going to go back to 2001, 2002, 2003 prices, so we have to know that. And then there can be financial problems derived from this in terms of balance of payments problems. The IMF has created the Exogenous Shocks Facility which provides a means for low-income countries to request financial assistance from the IMF when faced with an economic shock such as higher oil prices, and we are ready to assist the countries that will need that.

QUESTION: I understand India has voiced strong reservations on this whole approach to this quota issue, and I think your view is that you should have a credible formula and it should be a one-shot reform package because of the doubts about the implementation of a second stage whether that it will come through at all. So, what are your comments on this?

MR. DE RATO: Well, first of all, I'm not commenting on individual countries' positions. It's not my role, it's not my job. And I respect other positions of the countries. I can say what the position of the institution is. The position of the institution is what the majority of the Board represents. That's what I have to explain. The position of individual countries should be explained by the countries, and I have respect for any position.

I agree that the reform package needs to be implemented to be effective. And, as I said, the initial ad-hoc increase will only correct about one-third of the very heavy under representation of four countries that by every measure you use are underrepresented. Many other countries are underrepresented, too, but these ones, four cases were accepted by the Board as ones that were much more out of line than others.

Then we'll have to discuss a new formula, and I think that there is going to be a discussion—and I've explained before how important and complex that discussion is going to be—and open the door for a further increase in quotas for a broader range of members based on the formula, and also to establish a system by which future corrections will be easier done. If this doesn't happen then we will have to say that we have not addressed the governance issues. What today we are deciding is to address them and I'm encouraged by what I've seen, but of course the job is not finished, and there is a lot of work to do.

MR. AHMED: Let me come back now again to a question through the net. He'd like you to elaborate a bit on what you mean by rebalanced growth in Asia this year and in 2007.

MR. DE RATO: Well, it's clearly that more domestic growth will be good in many countries. In some countries, coming back to the levels of investment of the late '90s is an important step to guarantee that future growth will come. In many countries the levels of investment have recovered to the pre-crisis levels, and that of course is a sign that future growth will need those levels of adjustment to come back. Other issues is to make a business environment more attractive through flexibility, transparency, governance, strengthening institutions, and all that will help attract new investment. And also the use of more efficient financial integration in Asia that will help Asia use its own resources, its own very important saving resources to foster better growth in the future.

You have other cases in which you don't see the need for more investment. You've already seen a need for better investment, but you need to clearly see the need for more private consumption, and that demands better safety nets, better labor reforms, social reforms, but also financial reform that will make credit more available for people to benefit from. So, there is different cases in Asia, as it should be, given the size of the area. But it's clear that domestic demand with different components in different places is one of the areas in which we see the scope for more balanced growth in Asia and the future.

QUESTION: Just going back to the quota issue, I was wondering if you could tell when exactly will the new quota be announced for the second ad hoc. And also, if I could ask, what role will next year's general meeting play with regard to the two-year's package?

MR. DE RATO: Well, the rebalancing of quotas, a meaningful one, the strong one, will happen after we have agreed on a new formula. I cannot tell you when. I can tell you that there is a clear mandate in the resolution for us to start working immediately after Singapore, and there is also a mandate in the resolution for us to take stock and, if we can, take decisions in the annual meeting of 2007 and, in any case, in 2008. I think that is a very tight calendar but, at the same time, a physical one.

QUESTION: I want to ask a two part question but follow up on the question about the Chinese exchange rate. It wasn't clear to me from your response whether you think the Chinese have moved far enough and fast enough since they indicated a willingness to move to quite a flexibility in terms of establishing their rate of exchange. And the second part of the question has to do with the global economic outlook you, I think, expressed a relatively positive impression about the global outlook, but I wonder what you think about the geopolitical challenges, problems in Iraq, of course the situation in Iran regarding the nuclear issue. I wonder how that might, in your view, impact on the outlook.

MR. DE RATO: Well, I said, I think, very clearly that we believe that it's in the interest of China to implement more forcefully the change regime it gave itself last year and to let market forces determine things in China in a more clear way, certainly the value of the currency. We believe that will help with the shift of China to a pattern growth in which domestic demand will play a heavier role and more sustainable role. So, it's clear that right now what we see is not the need for a new system but implementation of the system that was agreed.

Geopolitical considerations are present in the economics of the world. I mean, it's obvious, and we see that in the price of oil, but we've probably seen the other issues, too. The International Monetary Fund doesn't have a political opinion about the issues. Of course we follow very closely the dramatic events that affect the lives of people, and we are sorry for that. We have certainly condemned terrorism. In more than one occasion it has attacked member countries. But we are not a political institution in terms of political analysis. We are a macroeconomics institution, and all that we can say is that certainly a part of what we see today in oil prices is related to geopolitical considerations. But at the same time I have to say that, as I said before, we are living and we will live in an area of oil prices that in relationship to what they were three, four years ago you can say they're high.

QUESTION: Can I ask a follow-up question on that? You said you were an institution, economic institution and really not concerned about the word "politics."

MR. DE RATO: I didn't say "concerned." I said that is not our role and we don't make judgments.

QUESTION: Yes, but do you agree that these two issues are inextricably linked, and if there is a dislocation, political unrest everywhere, it will affect the world economy?

MR. DE RATO: Expectations are a clear issue in any country and in the global economy, too, and if we live in a world that is more and more interrelated with very important financial markets, expectations are very important. We see them everyday. And that's obvious. We cannot tell you what is the exact impact of expectations every time, but expectations do play a role. Economic expectations play a very heavy role. We see that every day with the expectation of interest rates in every country, and we see also political expectations, elections, results of elections, social tensions, and certain geopolitical tensions. And that's a fact.

MR. AHMED: I'm going to take one more question from the internet. I'm going to take two questions from the floor and then we're going to bring this to closure. The question from the internet goes to the Singapore meetings, and it's he wants to know what is your assessment of the arrangements that the Singapore government has made so far in preparation for the IMF World Bank meetings?

MR. DE RATO: Well, I think from what I've seen—and I was in Singapore last spring in a meeting about financial integration in Asia with ministers and central bank governors, and that was my second visit to Singapore in the last two years—the arrangements are very good. I visited the Center and I visited the locations, and I talked to the minister in charge of-the vice president of Singapore and the vice premier of the Singaporean government, and we are very grateful to the efforts of the Singaporean authorities to host these meetings.

QUESTION: As far as I know about the quota issue, the United States, which has the majority voting power, is not positive that a large portion of raising quota is for the China. So I think this conference is very disputable in that point of view. So, could you explain about that?

MR. DE RATO: No, you explain, because what do you mean? Why did you say what you said?

QUESTIONER: In some point of view, the larger portion raising the quota for China or other countries? They can't have—

MR. DE RATO: Well, as you very well said, the United States is the biggest shareholder in the institution, and I don't have the same impression you have. Well, it's not a question of impression. I mean, it's a fact that United States has expressed clearly that they were backing the reform package; has made positive contributions to it, like others have done; has not expected that the package reflects a hundred percent of the United States not only in what it's decided, but also in the content, which is also what many others have done. And I cannot agree with what you're saying, sorry.

MR. AHMED: I'm going to take one last question.

QUESTION: My question is similar. According to US media report, the United States government want to increase quota in particular in China, because they think it can help to give pressure on China to reevaluate the yuan currency. And China doesn't want any link between two issues. So, there's the dispute between the United States and China—

MR. DE RATO: Well, a long time ago I learned that I don't make comments on what the newspapers said, and that's an interpretation of whoever writes in the newspapers. Well, I may agree or not, but, I mean, what do you want me to say? I can tell you what I see here, what I do here, but you asked me to comment on what the newspaper said about issues. You probably can do that much better than me. I don't make comments on news. I make comments on issues that I see here. That's what I can do. I'm the Managing Director of the Fund, but I cannot tell you to what extent those journalists are wrong or right. I cannot say that. I don't know.

I believe a lot but not necessarily everything I read. And I usually read not the same thing about the same issue. So, it's a complex world, not only macroeconomics.

MR. AHMED: Thank you very much for your questions. And, as I said, you'll have copies of the opening remarks when we leave, thank you.

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